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HomeMy WebLinkAbout1628 Stapleton In Re: Patrick Stapleton, : File Docket: 12-027 Respondent : X-ref: Order No. 1628 : Date Decided: 2/6/14 : Date Mailed: 2/12/14 Before: John J. Bolger, Chair Nicholas A. Colafella, Vice Chair Raquel K. Bergen Mark R. Corrigan Roger Nick Kathryn Streeter Lewis This is a final adjudication of the State Ethics Commission. Procedurally, the Investigative Division of the State Ethics Commission conducted an investigation regarding possible violation(s) of the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq., by the above-named Respondent. At the commencement of its investigation, the Investigative Division served upon Respondent written notice of the specific allegations. Upon completion of its investigation, the Investigative Division issued and served upon Respondent a Findings Report identified as an “Investigative Complaint.” A Stipulation of Findings and a Consent Agreement were subsequently submitted by the parties to the Commission for consideration. The Stipulated Findings are set forth as the Findings in this Order. The Consent Agreement has been approved. I.ALLEGATIONS: That Patrick Stapleton, a public official/public employee in his capacity as a Member and Chairman of the Pennsylvania Liquor Control Board (“PLCB”), violated Sections 1103(a) and 1105(b) of the State Ethics Act (Act 93 of 1998) when he used the authority of his public position for the private pecuniary benefit of himself, members of his immediate family, and/or a business with which he and/or members of his immediate family are/were associated by soliciting from PLCB vendor(s) donations of wine and/or liquor for events hosted by the Keystone Weekend Inc., an entity with which Stapleton and/or members of his immediate family are/were associated; when he solicited vendor(s) of the PLCB to arrange for and provide a celebrity chef(s) for the same event; when he received hospitality, including but not limited to: lunches, dinners, golf outings (which included cocktails, meals, greens fees and other amenities), paid for by PLCB vendor(s), all at a time when the vendor(s) had an ongoing business/contractual relationship with the PLCB; and when he failed to disclose on Statements of Financial Interests for the 2010 and 2011 calendar years the receipt of gifts, transportation, hospitality and/or lodging from vendor(s) of the PLCB. II.FINDINGS: 1. Patrick Stapleton served as a Member of the Pennsylvania Liquor Control Board (“PLCB”) from approximately June 17, 1997, through October 5, 2012. Stapleton, 12-027 Page 2 a. Stapleton was initially appointed effective June 17, 1997, and reconfirmed on May 10, 2000, May 17, 2004, and November 20, 2008. b. Stapleton served as Chairman of the PLCB from approximately January 17, 2007, through October 5, 2012. c. Stapleton also was appointed Chair of the National Alcohol Beverage Control Association (“NABCA”) effective May 2011. 2. The PLCB was created by state law on November 29, 1933, at the end of prohibition. a. Pennsylvania is one of eighteen (18) states and two (2) Maryland counties that actively participate in the distribution process to control the sale of alcohol. 3. The PLCB is governed by a three (3) Member Board, appointed by the Governor and confirmed by two-thirds of the State Senate. a. The Board appoints a Chief Executive Officer. 4. The PLCB is responsible for regulating the sale of alcohol, educating consumers on the responsible use of alcohol, and working to prevent underage use of alcoholic beverages. 5. The PLCB accomplishes its responsibilities through marketing and merchandising a retail operation of approximately 608 stores with sales of approximately $2.1 billion in 2011-2012. a. The PLCB also oversees: 1. Regulation of 17,000 licenses. 2. Administration of alcohol education and awareness programs. b. The current employment complement of the PLCB is approximately 4,500 people with four (4) labor associations. 6. Between December 6, 1933, and April 1934, the PLCB commenced operation by initiating the following: a. More than 600 licenses were approved, giving the new license holders, such as bars and restaurants, the right to legally sell alcohol for on-premises consumption in Pennsylvania. b. The PLCB opened sixty-three (63) state stores and five (5) warehouses in the Commonwealth. c. The PLCB established four (4) district offices in Philadelphia, Harrisburg, Pittsburgh, and Wilkes-Barre. 1. Since 1939, the PLCB has maintained its headquarters at the Northwest Office Building. 7. On April 12, 1951, the Pennsylvania General Assembly combined existing beer and liquor laws into one statute, entitled the “Liquor Code.” Stapleton, 12-027 Page 3 8. On July 1, 1987, the Pennsylvania General Assembly reenacted the Liquor Code and created the Bureau of Liquor Control Enforcement (“BLCE”), within the Pennsylvania State Police, which is responsible for enforcing the Liquor Code and the Board’s regulations; and the Office of Administrative Law Judge, an autonomous office within the PLCB, which is responsible for presiding over citation and enforcement hearings. 9. The PLCB provides products and services through seven (7) dedicated departments designed to meet the specific needs of PLCB customers and licensees. a. Each of the seven (7) dedicated offices has specific deputies in charge of it. b. Dedicated offices are: Finance, Supply Chain, Marketing & Merchandising, Retail Operations, Administration, Regulator Affairs, and External Affairs. 10. The PLCB is a high volume purchaser of wine and spirits in the United States. a. The PLCB currently operates approximately 608 stores, which are leased from private landlords. b. The PLCB outsources warehousing services for three (3) distribution centers in Pennsylvania. c. There currently are approximately 25,595 beverage alcohol licenses and permits throughout Pennsylvania and 5,391 registered malt and brewed beverage brands granted by the PLCB. 11. Products that are sold by the PLCB are categorized as either regular items, luxury items, or special order items. a. Regular items are products that are routinely stocked in the distribution centers. b. Luxury items are products that are purchased intermittently or as one-time purchases. c. Special order products are items that are not stocked in the PLCB distribution centers but may be special ordered by either licensees or by consumers. d. On or about February 4, 2004, the PLCB began the Chairman’s Selection Program, which offers wine at premium collection stores. 12. As a Control State, the PLCB is the only retail seller of wine/spirits/beer in the Commonwealth. a. The PLCB may grant licenses to entities/establishments for the sale of alcoholic beverages for on-site consumption as well as for vendors who sell products for off-site consumption. b. In order for an alcoholic beverage to be sold in Pennsylvania, it must be authorized for sale by the PLCB. 1. If a product is “listed” it is authorized for sale and stocked as a product in PLCB retail stores. Stapleton, 12-027 Page 4 13. In order to have a product sold by the PLCB, a manufacturer/supplier of alcoholic beverage products may employ several different methods to have its product represented within the Commonwealth of Pennsylvania. a. A manufacturer/supplier may market its product directly to the PLCB for the listing/delisting process as well as for sales and distribution. b. A manufacturer/supplier may market its product through a vendor. 1. For all sales/distribution, a vendor of record must be identified with the PLCB. 2. A manufacturer/supplier may also be a vendor/vendor of record. c. A manufacturer/supplier may enlist the services of a broker, who then in turn represents the manufacturer/supplier and its products before the PLCB. 1. Any broker may represent multiple manufacturers/suppliers and/or multiple products before the PLCB. 2. A broker may also serve as a vendor/vendor of record. 14. Once a product is manufactured, if a manufacturer/supplier is utilizing a vendor/vendor of record, product is then shipped to the custody of the vendor/vendor of record. a. The vendor takes physical custody of the product for delivery to the PLCB. b. Payment for the product is made between the PLCB and the vendor/vendor of record. c. If a manufacturer/supplier is serving as its own vendor/vendor of record, product is shipped directly from the manufacturer/supplier to the PLCB. 15. If a manufacturer/supplier is utilizing a broker, product is still distributed from the vendor/vendor of record to the PLCB. a. Where a broker is utilized, payment is made from the PLCB to the broker. b. A broker may also serve as a vendor/vendor of record. 16. The PLCB periodically reviews all products currently sold in PLCB retail stores to evaluate their profitability, and at or about the same time considers new products for placement in PLCB retail stores through a process known as “listing” and “delisting.” a. Listing/delisting occurs twice a year, usually in the fall and spring of each year. b. The goal of listing/delisting is to achieve a 1:1 ratio, [such that] for each product listed, one product is delisted, due to the limited amount of shelf space available at each PLCB retail store. 17. The process to present a new product for listing is regulated through the PLCB. Stapleton, 12-027 Page 5 a. Only individuals/entities with a Pennsylvania Vendor Permit may present items for listing. b. A fee of $150.00 (per item/per size) for each proposed new product listing is required. c. Appropriate paperwork as well as two (2) product samples for wine and one (1) product sample for spirits is required to be submitted. d. Once the appropriate application has been submitted, a date/time specific will be scheduled for a vendor/broker to present new product to [staff] members of the PLCB. e. Generally two (2) bottles of a product are provided for sampling. 1. One (1) bottle for tasting and another for label review are submitted. f. PLCB [staff] members usually responsible for evaluating new product are:  Director of Marketing and Merchandising  Chief Product Management and Pricing Division  Merchandising Pricing Coordinator(s). g. Presentation time is limited to forty-five to ninety (45-90) minutes per vendor/broker regardless of the number of items being presented for new listing. 1. Sampling is to occur at PLCB headquarters in a room called the REC Room. h. Once a new product presentation has been made, a recommendation will be made as to whether the new product should be listed (sold in PLCB retail stores). 1. A report of products to be listed is forwarded to the Commissioners for approval. 2. The Commissioners do not participate in the new product review process. 3. Commissioners vote on the entire recommended new product list, without any independent review of the product/support data. 4. The Director of Marketing and Merchandising along with the Chief of the Product Management and Pricing Division make the final recommendation to the Commission as to what product(s) should be listed for sale. 5. Luxury wines and one-time buys, including the Chairman’s Selection Program, are not subject to the listing/delisting process. 18. Delisting occurs simultaneously with the listing process. a. The delisting process is formally termed “category management,” but is commonly described as “bucketing” or “filtration” process. Stapleton, 12-027 Page 6 1. Products of like type are placed into categories; i.e. wines of a similar vintage, type, style, price, etc., are grouped together. 2. Items are categorized by length of time listed: items listed for less than one year are not eligible for delisting; items listed for between eighteen to twenty-four (18-24) months are reviewed separately from those items listed twenty-four (24) months or more. 3. After each item is reviewed, it is placed into a “bucket” if it passes the “filtering” criteria. For example, if a product meets the threshold criteria, it is “bucketed” to the next area of review. 4. Items are reviewed for their profitability with special attention being placed on: how much profit [was] generated; how many stores stocked the item; percentage of profit growth (20% growth is viewed by PLCB as a “good product.”) b. If a product is to be delisted, the vendor is notified and provided an opportunity to avoid a delisting. 1. Actions such as an advertising campaign, discounts, and product sampling are used to promote sales and possibly avoid a delisting. c. Recommendations for delisting are similar to listings, where the Director of Marketing and Merchandising along with the Chief of the Product Management and Pricing Division make the final recommendation to the Commission as to what product(s) should be delisted. 19. Prior to sometime in 2012, all product purchased by the PLCB was warehoused in PLCB facilities until distribution to PLCB retail stores. 20. During calendar year 2012, the PLCB initiated a purchasing/inventory system of bailment. a. Through the PLCB’s bailment system, product is shipped to PLCB warehouses from the vendor, as occurred pre-2012. b. PLCB does not transfer payment of funds or ownership of the product until it is to be shipped to the PLCB retail stores. c. The PLCB system of bailment allows for greater control over inventory and also limits the risk/exposure the PLCB may have regarding product loss. 1. Through the bailment process, PLCB maintains no more than three (3) to five (5) weeks’ worth of inventory within its warehouses. 2. Currently twenty seven (27) vendors are under bailment with the PLCB, which represents approximately 80% of the cash value of PLCB products sold. d. Prior to initiating a bailment process, PLCB staff were responsible for predicting the market for a particular product; if sales were not as expected, the PLCB would suffer a financial loss through spoilage of product if an excessive amount of product remained unsold. 21. The primary vendors providing products to the PLCB are: Stapleton, 12-027 Page 7  Southern Wine and Spirits  Capital Wine and Spirits  Allied Beverage (Majestic). 22. Southern Wine and Spirits of America, Inc. (“Southern”), [claims] to be the nation’s largest wine and spirits distributor. a. Since its creation/formation in 1968, Southern has maintained its corporate office in Miami, Florida. b. Currently, Southern represents clients in no less than thirty-five (35) states including “Control States” and “Open States.” 1. An “Open State” refers to a state/jurisdiction where wine, spirits, and beer sales are conducted through an independent beverage distributor/retailer. 2. A “Control State” is where a state or county “controls” or regulates the distribution and/or the sale of wine, spirits, and/or beer. 3. Pennsylvania is the largest Control State operation in the United States. 23. Southern Wine & Spirits of Pennsylvania operates as a licensed wine and spirits broker-marketer. a. Southern expanded its operations into Pennsylvania in 1995. b. Southern employs approximately two-hundred twenty-five (225) sales and support staff statewide in Pennsylvania. c. Southern maintains two (2) offices within Pennsylvania, one in the King of Prussia area, and the other in the Greater Pittsburgh geographic area. 1. These employees are responsible for marketing and merchandising alcoholic beverages to the more than six-hundred (600) PLCB state stores, as well as Pennsylvania’s 14,500 on-premise accounts. 2. The PLCB is Southern’s only off-premise customer. 24. Brad M. Waxman (“Waxman”) is the Executive Vice President, General Manager of Southern Wine & Spirits of Pennsylvania. a. In January 1999, Waxman initiated his employment with Southern. 1. In 2002, Waxman was named Executive Vice President, General Sales Manager of Southern’s Pennsylvania operations. b. Mark Sweeney is the Vice President and General Manager of North American Wine and Spirits, a division of Southern Wine and Spirits. 1. Sweeney also makes sales calls to PLCB officials and employees. 2. In 2008, Waxman was promoted to the position of Executive Vice President/General Manager of Southern’s Pennsylvania operations. Stapleton, 12-027 Page 8 25. Southern is a broker and vendor/vendor of record for a number of wines and/or spirits sold to the PLCB. a. Waxman serves as a broker for a number of the products before the PLCB. b. Products for which Southern serves as broker and/or vendor/vendor of record account for between approximately 6.43% to 6.85% of PLCB total Cost of Goods Sold (“COGS”) during the last five (5) years. c. A list of Southern’s business with the PLCB is detailed below: Fiscal Year Supplier Name Fiscal Year Percent of COGS Payment SOUTHERN WINE & SPIRITS OF PA 2007-2008 $ 62,051,980.00 6.60% SOUTHERN WINE & SPIRITS OF PA 2008-2009 $ 67,340,276.96 6.64% SOUTHERN WINE & SPIRITS OF PA 2009-2010 $ 72,529,178.51 6.85% SOUTHERN WINE & SPIRITS OF PA 2010-2011 $ 69,482,807.78 6.43% SOUTHERN WINE & SPIRITS OF PA 2011-2012 $ 77,641,059.78 6.78% * The spreadsheet above is only able to detail approximately 86% of PLCB inventory, as the remaining percentage is made up of small purchases. 26. In addition to Brad Waxman, Mark Sweeney also markets products to the PLCB on behalf of Southern. 27. Capital Wine & Spirits, LLC (“Capital”) claims to be one of the largest wholesalers/brokers of wine and spirits in Pennsylvania. a. Capital is a member of the Charmer Sunbelt Group, a nationwide distributor of wine, spirits, beer, and other beverages. b. The Charmer Sunbelt Group is a collection of privately held companies and operates distributor/brokerage houses in no less than fifteen (15) states, including Pennsylvania. c. Capital employs more than two-hundred (200) employees and reports to sell in excess of four million cases of wine and spirit throughout the Commonwealth. d. The reported 4 million cases of wine/spirit sales include sales to the PLCB. 28. Capital is a broker and vendor/vendor of record for a number of wines and/or spirits sold to the PLCB. a. Products brokered by Capital account for a total of between approximately 19.11% to 22.03% of PLCB total Cost of Goods Sold during the last five (5) years. b. A list of Capital’s business with the PLCB is detailed below: Fiscal Year Supplier Name Fiscal Year Percent of COGS Payment Stapleton, 12-027 Page 9 1 BACARDI USA INC. 2007-2008 $ 65,399,563.92 6.96% 1 BROWN FORMAN 2007-2008 $ 50,057,434.25 5.33% REMY COINTREAU USA INC. 1 2007-2008 $ 8,306,486.83 0.88% CAPITAL WINE & SPIRITS 2007-2008 $ 40,178,158.61 4.28% WHITE ROCK DISTILLERIES 2 2007-2008 $ 18,931,222.63 2.01% BANFI PRODUCTS CORPORATION 2 2007-2008 $ 12,874,577.00 1.37% SUTTER HOME WINERY 2 2007-2008 $ 11,305,649.31 1.20% Fiscal Year Supplier Name Fiscal Year Percent of COGS Payment BACARDI USA INC. 2008-2009 $ 62,721,532.75 6.19% BROWN FORMAN 2008-2009 $ 46,707,019.90 4.61% REMY COINTREAU USA INC. 2008-2009 $ 7,032,821.38 0.69% CAPITAL WINE & SPIRITS 2008-2009 $ 37,819,784.20 3.73% WHITE ROCK DISTILLERIES 2008-2009 $ 15,925,879.32 1.57% BANFI PRODUCTS CORPORATION 2008-2009 $ 14,124,707.82 1.39% SUTTER HOME WINERY 2008-2009 $ 14,381,248.01 1.42% Fiscal Year Supplier Name Fiscal Year Percent of COGS Payment BACARDI USA INC. 2009-2010 $ 67,263,103.22 6.35% BROWN FORMAN 2009-2010 $ 50,613,490.40 4.78% REMY COINTREAU USA INC. 2009-2010 $ 7,911,959.34 0.75% CAPITAL WINE & SPIRITS 2009-2010 $ 38,317,957.26 3.62% WHITE ROCK DISTILLERIES 2009-2010 $ 21,435,297.82 2.02% Stapleton, 12-027 Page 10 BANFI PRODUCTS CORPORATION 2009-2010 $ 16,606,904.35 1.57% SUTTER HOME WINERY 2009-2010 $ 15,255,869.66 1.44% Fiscal Year Supplier Name Fiscal Year Percent of COGS Payment BACARDI USA INC. 2010-2011 $ 61,685,074.98 5.71% BROWN FORMAN 2010-2011 $ 47,563,997.04 4.40% REMY COINTREAU USA INC. 2010-2011 $ 7,305,972.37 0.68% CAPITAL WINE & SPIRITS 2010-2011 $ 39,033,604.40 3.61% WHITE ROCK DISTILLERIES 2010-2011 $ 19,421,875.69 1.80% BANFI PRODUCTS CORPORATION 2010-2011 $ 16,521,319.81 1.53% SUTTER HOME WINERY 2010-2011 $ 14,909,694.70 1.38% Fiscal Year Supplier Name Fiscal Year Percent of COGS Payment BACARDI USA INC. 2011-2012 $ 60,866,013.23 5.31% BROWN FORMAN 2011-2012 $ 48,337,155.48 4.22% REMY COINTREAU USA INC. 2011-2012 $ 9,765,846.17 0.85% CAPITAL WINE & SPIRITS 2011-2012 $ 42,274,675.76 3.69% WHITE ROCK DISTILLERIES 2011-2012 $ 25,582,535.77 2.23% BANFI PRODUCTS CORPORATION 2011-2012 $ 16,385,912.23 1.43% SUTTER HOME WINERY 2011-2012 $ 18,394,480.35 1.61% 1 Members of TheAlliance 2 Manufacturers represented by Capital in Pennsylvania * The spreadsheet above is only able to detail approximately 86% of PLCB inventory, as the remaining percentage is made up of small purchases. 29. In an effort to condense marketing efforts and maximize sales and product exposure, several manufacturers/producers of wines, spirits and malt/brewed Stapleton, 12-027 Page 11 beverages have formed partnerships for marketing purposes; one such partnership is “The Alliance.” a. The Alliance is comprised of wine/spirit suppliers: Bacardi USA (“Bacardi”); Brown Forman; and Remy Cointreau (“Remy”). b. The Alliance was established by Bacardi, Brown Forman, and Remy to “re- shape” their route to market in order to provide greater service and access to the consumer. c. The goal of The Alliance was/is to create a way for Bacardi, Brown Forman, and Remy to leverage their scale and profitability in order to secure dedicated resources. 30. The Alliance is a United States program and is focused on distribution and a combined portfolio in an effort to compete with other suppliers. a. The Alliance covers twenty-six (26) markets, which include the state of Pennsylvania. b. Within Pennsylvania, The Alliance is represented by Capital Wine & Spirits/Charmer Sunbelt Group. 31. Bacardi was founded in 1862, with Bacardi USA being established in New York City in 1944. Bacardi USA relocated to Miami in 1964. a. Bacardi reports worldwide sales of $5.5 billion; Bacardi fiscal year recap for Pennsylvania included a PLCB Rolling 12 Market Profit of $113,127,361. b. The total Bacardi portfolio cases sold in Pennsylvania was reported at 642,870. c. Bacardi’s total Pennsylvania marketing budget was $5.4 million. 32. Brown Forman was founded in 1870 and is one of the largest American owned wine and spirit companies in the world, and is among the top ten largest global spirits companies. a. Brown Forman reported $3.2 billion annual net spirit and wine sales for Fiscal Year 2009. b. Brown Forman reported PLCB Rolling 12 Market Profit of $77,066,137.00. c. The total Brown Forman portfolio cases sold in Pennsylvania was 390,415.00. d. Brown Forman’s total Pennsylvania marketing budget was $2,582,120.00. 33. Remy is a two-hundred eighty-eight (288) year old company based in Paris, France, with global sales reported of over $1 Billion. a. Remy USA is headquartered in New York, and it was established in 1981. b. Remy USA reports to have spent approximately $983,500.00 in SPA support for sales programs during the 2011-2012 fiscal year; and an additional Stapleton, 12-027 Page 12 $400,000.00 in marketing support for the Pennsylvania marketplace annually. c. Total estimated expenditures for marketing in Pennsylvania total $1,383,500.00 or approximately $23.00 on every case of beverage sold in the State of Pennsylvania. 34. Capital Wine and Spirits representatives interacting most often with PLCB officials include the following: Mark Littles, President, Capital Wine and Spirits Christina Desmond, Director of Marketing and Business Analytics Rob Sirota, General Manager, Alliance Division of Capital Wine and Spirits Kevin McCarty, Vice-President of Compliance and Administration of Capital Wine and Spirits Tim Kilcullen, Vice President Wine and Education, Capital Wine and Spirits. 35. Allied Beverage Group, LLC (“Allied”) was created by the mergers of The Baxter Group, Inc., F&A Distributing Company and The Jaydor Corporation. a. Allied reports to be New Jersey’s largest and most comprehensive wine and spirits distributor and ranks among the ten largest distributors in the United States. b. Allied also operates subsidiary Majestic Wine & Spirits, USA, LLC (“Majestic”), which is a Pennsylvania brokerage and vendor/vendor of record for products sold to the PLCB. 1. As a broker/vendor, Majestic provides merchandising and promotional services for several major suppliers of alcoholic beverages. 2. Majestic reports to be the PLCB’s highest volume distributor of “special liquor orders.” 36. As a broker and vendor/vendor of record for products sold to the PLCB, Allied’s and/or Majestic’s sales account for between approximately 1.51% to 2.18% of PLCB total Cost of Goods Sold during the last five (5) years. a. A detailed list of Majestic’s business with the PLCB is detailed below: Fiscal Year Supplier Name Fiscal Year Percent of COGS Payment MAJESTIC WINE AND SPIRITS 2007-2008 $15,623,508.91 1.66% MAJESTIC WINE AND SPIRITS 2008-2009 $15,267,768.10 1.51% 2009-2010 $16,454,785.45 1.55% MAJESTIC WINE AND SPIRITS 2010-2011 $16,973,020.65 1.57% MAJESTIC WINE AND SPIRITS 2011-2012 $25,000,032.79 2.18% MAJESTIC WINE AND SPIRITS Stapleton, 12-027 Page 13 37. Majestic’s primary contacts with PLCB officials and employees are Chris Papariello and Edward Murray. a. Papariello is Executive Vice-President of Majestic. b. Murray serves as Majestic’s Eastern Regional Manager. 38. Executives and marketing representatives from vendors supplying products to the PLCB would meet with PLCB officials and employees to market products. a. Those representatives offered gifts and hospitality to PLCB [representatives], including Stapleton. b. These items, including golf events, meals, and hospitality, were offered when listing/delisting of [products] was occurring. c. Items of value were routinely provided to PLCB officials who were in discussion [sic] making positions regarding product selection and placement. 39. As the Chairman of the PLCB, Stapleton interacted and met with suppliers and brokers of wine and spirits for the PLCB, including representatives of Capital, Southern, Majestic (Allied Beverage), and White Rock Distilleries, a vendor represented by Capital and Jim Bean Global. a. Stapleton would meet with suppliers/brokers at the offices of the PLCB, store openings, golf outings, and dinner meetings at restaurants. b. Individuals that Stapleton as the PLCB Chairman had specific dealings with from the above listed entities included: Mark Littles, President of Capital Wine & Spirits; Cristina Desmond, Director of Marketing and Business Analytics for Capital Wine & Spirits; Tricia Brungo, Control State Manager for White Rock Distilleries; Mark Sweeney, Vice President of Sales in Pennsylvania for Diageo; Christopher Papariello, the Executive Vice- President of Majestic Wine and Spirits; Erin “Red” Schiller, Jim Bean Global; and Brad Waxman, Southern Wine and Spirits. c. These individuals and other vendor marketing representatives provided Stapleton with gifts, meals, alcohol donations and golf outings during his tenure with the PLCB. THE FOLLOWING FINDINGS RELATE TO ALLEGATIONS THAT STAPLETON SOLICITED WINE AND/OR SPIRITS FROM PLCB VENDORS FOR USE BY THE KEYSTONE WEEKEND AT A TIME WHEN STAPLETON WAS RESPONSIBLE FOR APPROVING PLCB VENDOR LISTINGS/DELISTINGS. 40. The Keystone Weekend, Inc. (“Keystone Weekend”) is a 501(c)(3) non-profit corporation established by Stapleton and his then wife, Kelly Beaudin Stapleton. a. Creation documents for the Keystone Weekend were filed with the Pennsylvania Department of State, Corporation Bureau, on February 7, 2008. 1. Entity number 3787530 was assigned to the Keystone Weekend by the Pennsylvania Department of State. Stapleton, 12-027 Page 14 2. The registered office address for the Keystone Weekend with the Pennsylvania Department of State is 1825 Delancey Street, Philadelphia, Pennsylvania 19103. 41. Stapleton has been an officer/director for the Keystone Weekend since its inception in 2008. a. The Keystone Weekend is a business with which Stapleton is associated. b. Pursuant to a Pennsylvania Supreme Court case, Rendell v. Pa. State Ethics Commission, 983 A.2d 708 (Pa. 2009), the term “business,” as defined by Pennsylvania's Public Official and Employee Ethics Act, 65 Pa.C.S. § 1102, should be interpreted to include non-profit entities. 42. The genesis of the Keystone Weekend is an annual, multi-day event, consisting of panel discussions to foster the free exchange of ideas on significant issues affecting Pennsylvania society. a. The Keystone Weekend is a private function and can only be attended by invitation. 1. Although an invitation only event, there is a registration fee for those planning to attend. 2. The registration fee does not include the cost of transportation to or from the Keystone Weekend or lodging. 43. The Keystone Weekend publishes its Mission Statement as follows: [Being dedicated] to bringing together innovative leaders from a variety of disciplines such as business, government, academia, the arts, finance, sports and entertainment to promote a lively exchange of ideas, experiences and visions in response to significant issues of the day and to promote innovation which will positively impact the lives of individuals throughout the Commonwealth of Pennsylvania, and across the nation. a. The Keystone Weekend website included an e-mail contact for Patrick Stapleton as pstapleton@state.pa.us. 1. This was Stapleton’s Commonwealth e-mail address. b. Keystone Weekend attendees have included governors, United States senators and congressman, mayors, state legislators, college presidents, corporate chief executive officers, philanthropists, leaders in the arts and humanities, physicians and scientists. 44. Meals, including meals prepared by celebrity chefs, and alcoholic beverages are provided as part of the Keystone Weekend. 45. From 2008 through 2012, the Keystone Weekend held annual events at the Hotel Hershey in Hershey, Pennsylvania. a. Annually, event arrangements were handled between Stapleton and/or his designees and representatives from the Hotel Hershey. Stapleton, 12-027 Page 15 46. For years 2008 through 2012, Keystone Weekend events were held at the Hotel Hershey on the following dates: Year Dates 2008 April 25, 2008—April 27, 2008 2009 May 7, 2009—May 10, 2009 2010 May 6, 2010—May 9, 2010 2011 September 21, 2011—September 26, 2011 2012 September 19, 2012—September 23, 2012 47. Keystone Weekend LLC, while Stapleton was Chair of the PLCB, accepted bulk delivery/supplied alcoholic beverage(s) from vendors of the PLCB for utilization by attendees at the Keystone Weekend. a. Business records of the Hotel Hershey reflect that wine and spirits were “donated” for Keystone Weekend events held in 2008 through 2011. 1. Vendors donated wine and spirits that were served during the course of Keystone Weekend, including scheduled receptions and dinner events. b. Keystone Weekend Banquet Event Orders include the name(s) of wine and spirit companies credited with donations as part of Keystone Weekend event functions. c. Stapleton utilized his legal assistant, Kristine Francis, from his private law practice to coordinate the Keystone events. 1. Stapleton also discussed Keystone Weekend with members of the PLCB staff, including Faith Diehl, Chief Counsel to the PLCB. 2. Diehl and other PLCB officials/staff often attended Keystone Weekend events. 48. Keystone Weekend events included donated wine and/or spirits served for the following purposes in 2010 and 2011: a. Wine Tastings 1. 2010: a. Wine tasting in the Blue Mountain Room with wine purveyor providing its own wine on 5/7/10. i. The specific purveyor was not identified. 2. 2011: a. Wine tasting in the Castilian Room on 09/23/11 with wine purveyor providing its own wine to include $20.00 per bottle corkage fee. i. The specific purveyor was not identified. b. Meals, and/or beverages: 1. 2010: Stapleton, 12-027 Page 16 a. Castilian Room 8:00 p.m.–9:00 p.m. Quality Wines of Spain donated dinner wines with $8.00 per person corkage fee. i. The specific wines served were not identified. b. Celebrity chef appearance in the Castilian Room 8:15 p.m.– 10:00 p.m., A Taste of Spain dinner. 2. 2011: a. Castilian Room 7:50 p.m.–10:00 p.m. Majestic Wine and Spirits donated dinner wines with $2,500.00 flat rate conference corkage fee. i. Specific wines provided by Majestic Wine and Spirits are detailed below. b. Celebrity chef appearance in the Castilian Room 7:50 p.m. – 10:00 p.m. (dinner event). c. Other alcohol services: 1. 2010: a. Self-serve bar in the Milton Hershey suite with all alcohol to be provided via donation with a $15.00 per bottle corkage fee. i. The self-serve bar was left set up from Thursday, May 6, 2010, at 7:00 p.m. until Sunday, May 9, 2010, at noon. 2. 2011: a. Hospitality suite in the Milton Hershey parlor with all alcohol to be donated. b. Hospitality bar (off property full bar) with delivery of donated alcohol from Allied Beverage. In 2010 and 2011, Keystone Weekend LLC paid the corkage fees associated with Keystone Weekend. 49. Electronic communications between Stapleton and/or representatives acting on Stapleton’s behalf and PLCB vendors detail the dialogue as to donations being provided for the 2011 Keystone Weekend. a. Business records of Majestic Wine and Spirits include multiple email communications in relation to the 2011 Keystone Weekend. 1. Multiple email communications regarding the 2011 Keystone Weekend were supplied spanning the date range of August 3, 2011, through September 30, 2011, as summarized below. b. Business records of Charmer Sunbelt Group (Capital Wine & Spirits) include multiple email communications in relation to the 2011 Keystone Weekend. Stapleton, 12-027 Page 17 1. On August 24, 2011, at 3:24 p.m., Francis emailed Rachel McCoach of Charmer-Sunbelt at Stapleton’s direction regarding the wine and spirits donation for the Keystone Weekend. a. Dialogue captured in the email follows: I spoke to PJ [Stapleton] and he said to provide enough for two, 3-hour cocktail receptions (30 people/75people). I hope that helps – LOL. I cc’d Donna Balmer and Ben Irwin from Hershey Hotel on this email since they will be handling the delivery. If you could send me a list of what your [sic] sending over, that would be great! Let me know if you need more information. b. McCoach replied to Francis at 3:28 p.m. on August 24, 2011, indicating that she was “not sure what the products will be just yet, but I will get to work on finding sponsors. I’ll get back in touch with you when I have confirmed the items.” c. The alcohol donation for this event was confirmed in an email sent September 1, 2011, at 9:17 a.m. from Rachel McCoach (Charmer-Sunbelt) to Kristine Francis. In that email, McCoach indicated to Francis that she “just wanted to confirm our product donation for this event. Please see the below list of items and let me know if you have any questions.” d. Wines identified by McCoach in her September 1, 2011, email were as follows: Red wine: Sonoma Cutrer Pinot Noir – 9 bottles Bearboat Syrah – 9 bottles White wine: Sonoma Cutrer Russian River Chard – 9 bottles Bearboat Sauvignon Blanc – 9 bottles Spirits: Vodka – Grey Goose (12 bottles) Gin – Bombay Sapphire (2 bottles) Rum – Bacardi Superior (2 bottles) Scotch – Macallan 12Yr (2 bottles) Bourbon – Woodford Reserve (2 bottles) Tequila – Herrandura Anejo (2 bottles) Cognac -Remy VSOP (2 bottles) c. In a September 12, 2011, e-mail, Mark Littles, President of Capital Wine and Spirits, advised Stapleton as follows: By the way, the wine and spirits for Keystone Weekend is taken care of. Speak soon. Mark Stapleton, 12-027 Page 18 50. Stapleton personally and/or [Stapleton’s representatives,] at his direction, accepted donations of alcohol from PLCB vendors for the 2011 Keystone Weekend which were valued at in excess of $1,581.51 as detailed below: a. Majestic Wine & Spirits: Inv. No. Inv. Product Desc Size Quantity/Type Unit Net Date No. Amount Amount 295715 08/30/11 5259147 Baron Fini Pn Grg 750ML 2/Cases $80.76 $161.52 5275041 R. Bilbao Crianza* 750ML 1/Case $79.91 $79.91 4042241 Vidal Flry Cdr Ros* 750ML 2/Cases $86.59 $173.18 5259147 Baron Fini Pn Grg 750ML 2/Bottles $6.73 $13.46 203235 09/14/11 4042241 Vidal Flry Cdr Ros 750ML 2/Bottles $7.22 $14.44 315459 09/14/11 5275042 R. Bilbao Crianza 750ML 2/Cases $79.91 $159.82 Total $341.12 $602.33 *Indicates one hundred percent bill back to supplier b. Capital Wine & Spirits/Alliance Group: CWS Inv. CWS Inv. Supplier Product Product Units Total Description Number Date Billed Obtained Cost Cost* 5200001116 09/30/11 Brown Forman Woodford $21.45 2 $45.47 Keystone Spirit RSV $25.75 2 $54.59 Weekend Event Samples Only Bourbon $100.06 Herradura Tequila Anejo 5200001117 09/30/11 Brown Forman Son Cutrer P $19.18 9 $183.01 Keystone Noir $11.95 9 $113.99 Son Cutrer $297.00 Chard 5200001194 09/30/11 Bacardi Grey Goose $16.47 12 $209.50 Keystone Vodka $14.16 2 $30.02 Weekend Event Bombay Gin $8.72 2 $18.49 Sapphire $258.01 Bacardi Rum Superior 5200001202 09/30/11 Remy Remy Martin $21.06 2 $44.64 Keystone Cointreau USA Cogn VSOP $10.75 9 $102.56 BearBoat $147.20 Syrah 1800015859 10/31/11 Remy Bearboat $6.99 9 $62.91 Keystone Cointreau USA Sauv Blc $51.99 2 $103.98 Weekend (Illegible) $176.91** Event, Scotch samples **[sic] purchased @ store Total $979.18 *Includes sales tax Stapleton, 12-027 Page 19 51. Between 2008 and 2011, alcohol was donated to the Keystone Weekend by PLCB vendors at no charge to Stapleton and/or the Keystone Weekend. a. The quantities and sources for all alcohol donations to the 2008–2010 Keystone Weekends were not ascertainable. b. Executives from Capital Wine and Spirits, Majestic and Southern Wine & Spirits provided sworn statements to the Investigative Division admitting that quantities of alcoholic beverages were annually provided to the Keystone Weekend. 1. For the 2009 event, Southern donated and delivered fifty-one (51) cases of wine including: 2007 Sauvignon Blanc, 2007 Friulano, 2006 LaMozza Morellino. 2. Quality of Wines of Spain provided an undetermined quantity of wine for the 2010 event. 3. Allied Beverage (Papariello) provided wine/spirits for the 2011 event. 52. Keystone Event records from the Hotel Hershey document the highest number of plate counts per year regarding meals to be served as follows: Year Plate Count 2010 100 2011 90 53. The minimum value associated with bottles of wine and/or spirits donated to the 2011 Keystone Weekend event by PLCB vendors totaled at least $1,581.51. 54. On or about August 23, 2011, Papariello and Stapleton attended a dinner at Zahav Restaurant, located in Philadelphia, prior to the 2011 Keystone Weekend. a. Papariello paid for dinner expenses totaling $201.96 for him and Stapleton at Zahav, on August 23, 2011. 1. Papariello claimed this dinner as a business expense. b. Stapleton’s 50% share of the dinner expense was $100.98. c. Stapleton did not reimburse Papariello for any portion of Stapleton’s dinner expense; however, Stapleton paid for cocktails before dinner and parking. Stapleton also drove Papariello to and from the dinner. 55. Stapleton provided a statement to Commission investigators on July 15, 2013, during which Stapleton provided the following information: a. Alcohol for the 2008 through 2011 Keystone Weekend events had been donated by combinations of various vendors over the years including Capital Wine & Spirits, Southern Wine & Spirits and Majestic Wine and Spirits. b. Stapleton and/or his representatives at his direction informed vendors of other vendors donating alcohol to the events and inquired as to their interest in supplying donations as well. Stapleton, 12-027 Page 20 c. Stapleton and/or his representatives at his direction informed the vendors of the amount of alcohol needed to accommodate “x” number of individuals. d. In relation to questions regarding his solicitation and acceptance of alcohol for Keystone Weekend and potential Ethics Act implications, Stapleton stated that he did not know that such donations were improper but, “if that’s a violation, that’s a violation.” 1. Stapleton asserted that these same vendors routinely donate to charities and government events, including the past inaugural events of Pennsylvania governors. 2. Stapleton has loaned Keystone Weekend LLC substantial monies, goods and services (in excess of $10,000) and has not been repaid. 56. Employees of the PLCB were authorized to attend the Keystone Weekend events on Friday, September 23, 2011. Employees were not required to submit leave to attend the event. THE FOLLOWING FINDINGS RELATE TO ALLEGATIONS THAT STAPLETON ACCEPTED OFFERS FROM A PLCB VENDOR TO PARTICIPATE IN THE 2010 AND 2011 AT&T PRO-AMS AT/OR ABOUT TIMES WHEN STAPLETON WAS RESPONSIBLE FOR APPROVING LISTINGS/DELISTINGS AND PURCHASES WHICH INCLUDED PRODUCTS FROM THE OFFERING VENDOR. 57. In 2010 and 2011, Capital Wine and Spirits invited Stapleton and members of the PLCB to participate in Pro-Am golf events occurring at the Aronimink Golf Club. a. Aronimink Golf Club is a private country club located at 3600 St. Davids Road, Newtown Square, Pennsylvania 19073. b. The golf club has a championship golf course that is rated as one of the top golf courses in the United States. c. Mr. Stapleton is a member of Aronimink Golf Club, and was a member in 2010 and 2011. 58. The AT&T National Golf Tournament (“AT&T Tournament”) was held at Aronimink Golf Club during 2010 and 2011. a. The AT&T Tournament was part of the Professional Golf Association (“PGA”) Tour, in which weekly tournaments are held across the country. b. The AT&T Tournament at Aronimink Golf Club was managed and organized by the Tiger Woods Foundation for the PGA. 1. The Tiger Woods Foundation was established in 1996 by Tiger Woods and his father, Earl Woods, to create and support community- based programs that improve the health, education and welfare of all children in America. 2. One of the programs supported was the AT&T Tournament. 59. The AT&T Tournament is normally held from Monday through Sunday. Stapleton, 12-027 Page 21 a. From Monday through Wednesday, Pro-Am Tournaments are held, in which amateurs will play along with a professional golfer for a fee. b. The actual PGA golf tournament is held from Thursday through Sunday. c. As part of the AT&T Tournament held at Aronimink Golf Club in 2010 and 2011, Pro-Am Tournaments were held Monday through Wednesday. 60. Costs in association with playing in a PGA Pro-Am event varied depending on whether or not a golfer was sponsored. a. Sponsors of Pro-Am events are generally provided with passes to participate in the Pro-Am event. b. The fees to play in Pro-Am events varied by day of week and accompanying professional golfer. c. The fees could range from $1,200.00 to $9,500.00. 61. When the AT&T Tournament was held at Aronimink Golf Club in 2010 and 2011, the Tiger Woods Foundation, in conjunction with the PGA Tour, organized and managed the tournament. a. Neither Aronimink Golf Club nor its members played any role in the tournament, nor were they given the opportunity for any discounts that included playing in the Pro-Am. 62. As part of managing and organizing the AT&T Tournament held at Aronimink Golf Club in 2010, the Tiger Woods Foundation offered sponsorships to various corporations and businesses. a. One of the sponsors of the Tournament was Bacardi, USA. 63. Bacardi, USA is a division of Bacardi Limited, the largest privately held family owned spirits company in the world. a. Capital Wine and Spirits serves as a broker for Bacardi in Pennsylvania. 64. In 2010, Bacardi, USA donated approximately $140,000.00 to sponsor multiple Tiger Woods Charity Golf Events in the United States, which included the AT&T Tournament held at Aronimink Golf Club. a. As part of being a sponsor for events involving the Tiger Woods Foundation in 2010, three (3) tickets were provided by Bacardi, USA to its broker in Pennsylvania (Capital Wine & Spirits) to participate in the AT&T Pro-Am held at Aronimink Golf Club. 65. As a vendor of the PLCB, Capital Wine & Spirits--broker for Bacardi, USA--invited Stapleton, along with PLCB Board Member Robert Marcus and PLCB CEO Joe Conti, to participate in the 2010 AT&T Pro-Am held at Aronimink Golf Club. a. Capital’s President, Mark Littles, provided the invitation to Stapleton, Marcus, and Conti at a time when Capital Wine & Spirits served as broker for multiple products listed/pending listing before the PLCB. Stapleton, 12-027 Page 22 b. Littles, Stapleton, Conti and Marcus are all experienced golfers, with golf handicaps established by the United States Golf Association. 66. Stapleton, Joe Conti, PLCB CEO, and Robert Marcus, PLCB Member, played in the Pro-Am at the AT&T Tournament on June 28, 2010, at Aronimink Golf Club. 67. The following packaged benefits were included in the 2010 Pro-Am: Stapleton, 12-027 Page 23 Package Benefits  One (1) playing spot in the Aronimink Pro-Am on Monday, June 28, 2010, with a PGA Tour Pro on the tournament course (1 professional, 4 amateurs);  One (1) Pro-Am gift package – valued at $197.62 each;  Food and beverage throughout the Monday Pro-Am event, including breakfast and a reception to follow play;  One (1) Aronimink Pro-Am Badge (good for admission all week to the clubhouse/grounds/locker room access on Monday only);  One (1) Aronimink Pro-Am guest badge (good for admission all week into clubhouse/grounds)  One (1) clubhouse parking credential (valid Monday only) a. Stapleton asserts that he did not avail himself of the Pro-Am gift package. 68. Capital Wine & Spirits records detailing cash receipts for the month of July 2010, document cash deposits from Stapleton, Conti, and Marcus for participation in the 2010 AT&T Pro-Am as shown in the chart below: Date Name Description Payment Method Amount 07/08/2010 Stapleton PLCB Donation Cash $160.00 07/08/2010 Conti PLCB Donation Cash $200.00 07/08/2010 Marcus PLCB Donation Cash $100.00 a. The payments received by Capital Wine & Spirits were subsequently donated to the American Diabetes Association. 69. In his statement to the Commission on July 15, 2013, Stapleton said that he provided $160 as payment for the 2010 AT&T Pro-Am. Stapleton estimated the approximate cost of the value of his round of golf based on his membership at Aronimink and that he did not avail himself of the full benefits package. 70. In 2011, Bacardi, USA donated approximately $80,000.00 to sponsor multiple Tiger Woods Charity Golf Events in the United States, which included the AT&T Tournament held at Aronimink Golf Club. a. As part of being a sponsor for events involving the Tiger Woods Foundation in 2011, three (3) tickets were provided by Bacardi, USA to its broker in Pennsylvania (Capital Wine & Spirits) to participate in the AT&T Pro-Am held at Aronimink Golf Club. b. In addition to the three (3) tickets to play in the Pro-Am in 2011, Bacardi received many of the same benefits that it had received in 2010. 71. As a vendor of the PLCB, Capital Wine & Spirits--broker for Bacardi, USA--invited Stapleton and Conti to participate in the 2011 AT&T Pro-Am held at Aronimink Golf Club. a. Capital’s President, Mark Littles, provided the invitation to Stapleton and Conti at a time when Capital Wine & Spirits served as broker for multiple products listed/pending listing before the PLCB. Stapleton, 12-027 Page 24 72. Leading up to the 2011 AT&T Tournament, Mark Littles and Stapleton exchanged the following emails: Littles to Stapleton April 15, 2011, 3:03 p.m. Hi PJ, Hope all is well with you and you are getting ready for a good weekend! Great news…Grey Goose is sponsoring the AT&T golf event at your home course again this year and they would like for you and I to take part in the Golf Pro Am th on Wednesday June 29. Please let me know if you can make it and who else you want to join us that day…Joe Conti? th Tuesday night the 28, we can participate to pick our pro and tee time. Speak with you soon. Mark Littles to Stapleton May 25, 2011, 8:50 a.m. Hi PJ Good spending time with you in Arizona and congratulations again! Having read the sports section of the inquirer this morning, I was reminded of the Upcoming AT&T Pro Am, as they had Tiger Woods at Aronimink yesterday. The Pro Am is Wednesday 6/29 and we pick out our time and pro we want at Dinner the night before, Tuesday 6/28. Bob Marcus cannot join us so I will be calling Joe Conti to complete the foursome and hopefully he can make it. Bart and Kevin want to caddy for you and Joe, Hopefully that will not hurt your game too much… Mark Stapleton to Littles May 25, 2011, 7:29 p.m. Can’t hurt my weak game. Looking forward to it. Littles to Stapleton June 20, 2011 3:38 p.m. Hi PJ Hope you had a good fathers day and got to watch some of the US Open. We have a packet for you for the Pro Am next week….passes, parking, invites, etc. along with a Grey Goose golf bag from Bacardi if you can use it… Kevin and bart are going to be in Harrisburg on Wednesday and will drop off the Packet. If you can use the golf bag, we can bring to Pro Am. See you next week. Thanks, Mark Stapleton to Littles June 20, 2011, 6:37 p.m. Thx Mark. Probably will not need the bag. 73. Stapleton played in the Pro-Am at the AT&T Tournament on Wednesday, June 29, 2011, at Aronimink Golf Club. 74. The following packaged benefits were included in the 2011 Pro-Am: Package Benefits Stapleton, 12-027 Page 25  One (1) playing spot in the AT&T national Pro-Am on Wednesday, June 29, 2011 with a PGA Tour Pro on the tournament course (1 professional, 3 amateurs);  One (1) Pro-Am VIP gift package – valued at $487.70 per player;  Food and beverage throughout the Wednesday Pro-Am pairings reception;  One (1) Contestant badge (that allows you inside the ropes on Wednesday during your round and is also good for admission all week to the clubhouse/grounds;  One (1) Pro-Am guest badge (good for admission all week to the clubhouse/grounds);  One (1) clubhouse parking credential (valid Wednesday only). a. Stapleton asserts that he did not avail himself of the Pro-Am VIP gift package. 75. Capital Wine and Spirits records did not reflect any payment by Stapleton to Capital Wine & Spirits in association with Stapleton’s playing in the 2011 AT&T Pro-Am. a. Stapleton asserted [that he] issued payment to Littles in the amount of $300.00. b. Capital records have no evidence to support Stapleton’s claim. c. Stapleton has provided ATM withdrawal receipts to corroborate his payment of $300. 1. Stapleton estimated the approximate cost of the value of his round of golf based on his membership at Aronimink. THE FOLLOWING FINDINGS RELATE TO STAPLETON’S RECEIPT OF GIFTS AND HOSPITALITY FROM VENDORS IN ASSOCIATION WITH GOLF OUTINGS/EVENTS ATTENDED WHILE STAPLETON, AS A MEMBER AND CHAIRMAN OF THE PLCB, WAS RESPONSIBLE FOR APPROVING LISTINGS/DELISTINGS AND PURCHASES OF ALCOHOLIC BEVERAGE, WHICH INCLUDED PRODUCT FROM THE VENDOR/SUPPLIERS SPONSORING THE OUTINGS. 76. Between 2009 and 2011, Capital organized golf outings which included officials and management employees of the PLCB. a. Stapleton was one of the PLCB employees/officials invited to these events. 77. Robert Sirota is employed as the General Manager, Alliance Division, for Capital Wine and Spirits. a. As General Manager, Sirota serves as the direct liaison between the Alliance suppliers and Capital Wine and Spirits. b. Sirota reports directly to Mark Littles, President, Capital Wine and Spirits. 78. In or about 2009, the concept for an Alliance Golf Open was conceived as a collaborative effort between Sirota and members of the Alliance. Stapleton, 12-027 Page 26 a. The golf outing was organized as a means by which Capital Wine and Spirits and the Alliance suppliers could strengthen their relationship with the PLCB and to allow various Alliance senior management officials to have “face time” with PLCB officials. 79. Sirota served as the Capital Wine and Spirits lead/point of contact in relation to organization of the Alliance Golf Open. a. Although Sirota served as the event lead, individuals to be invited from the PLCB were determined through a collaboration between Sirota, Littles, Christine Desmond (Director of Marketing and Business Analytics, Capital Wine and Spirits), and/or the Alliance suppliers. b. Actual invitations to PLCB officials for the event were made by Littles and/or Desmond. 80. Alliance Golf Open events were held in 2009, 2010, and 2011. a. Sirota served as the Capital Wine and Spirits organizer for the event each year. b. Invitees to the 2010 and 2011 events were identified in the same manner as in 2009. c. Actual invitations for the 2010 and 2011 events were made by the same individuals as the 2009 Open. d. Stapleton did not participate in the 2009 Alliance Golf Open. 81. The 2010 and 2011 Alliance Open were one-day events consisting of morning travel (if necessary), a warm up session, lunch, a round of golf (eighteen holes), and dinner in the evening. a. Sirota developed the itinerary for each respective Alliance Open. b. No specific time slot was designated/reserved for any specific business/product presentation by Capital Wine and Spirits and/or the Alliance suppliers. c. Records do not indicate any business/product presentations were made by Capital Wine and Spirits and/or the Alliance suppliers at the events. d. In his statement to the Commission on July 15, 2013, Stapleton asserted that the event had a business purpose and recalled attending a business presentation. e. When pairing golfers, a specific intent was made to pair a PLCB official/employee with an Alliance/Capital representative. 82. The costs associated with the 2010 and 2011 Alliance Golf Open were borne by the Alliance suppliers and Capital Wine and Spirits. a. The total costs of the events were divided into four equal amounts to be paid by Capital Wine and Spirits, Bacardi, Brown Forman, and Remy. Stapleton, 12-027 Page 27 83. The 2010 Alliance Golf Open was held at the River Crest Golf Club, 100 Golf Club Drive, Phoenixville, PA 19460 on July 15, 2010. a. The roster/itinerary for the 2010 Alliance Open identified the individuals participating as shown below: Group No. Player Affiliation #1 PJ Stapleton PLCB, Board Member/Chairman Joe Davolio Capital Wine & Spirits: The Charmer Sunbelt Group, Executive VP Capability Development Mark Littles Capital Wine & Spirits: The Charmer Sunbelt Group, President Al Bruni Bacardi USA Group No. Player Affiliation #2 Joe Conti PLCB Chief Executive Officer Kevin McCarty Capital Wine & Spirits: The Charmer Sunbelt Group, VP Compliance & Administration Matt Symanski Brown-Forman, Territory Sales Manager Rob Sirota Capital Wine & Spirits: The Charmer Sunbelt Group, Director of Alliance Brands Group No. Player Affiliation #3 Jim Short PLCB, Director of Marketing Mike Remitz Remy Cointreau USA, VP/Division Manager Bart Pio Capital Wines & Spirits, Chairman Scott Pickford Bacardi USA Group No. Player Affiliation #4 Matt Schwenk PLCB, Director of Product Selection Dave Franke Brown-Forman, State Manager PA/DE Brad Moser Remy Cointreau USA, Regional Sales Manager Cristina Capital Wine & Spirits: The Charmer Sunbelt Group, Director of Desmond Marketing and Business Analytics 1. Fifteen (15) individuals participated in the 2010 Alliance Open, including three (3) PLCB officials/employees. b. The itinerary for the event documented the following activities: 11:00 a.m. Warm up / Range-River Crest Golf Club 12:00 p.m. Lunch-Greenside Grille 1:00 p.m. First Group Tee Time 1:10 p.m. Second Group Tee Time 1:20 p.m. Third Group Tee Time 1:30 p.m. Fourth Group Tee Time th 5:00 p.m. 19 Hole-Cocktails at the Club House Bar 6:00 p.m. Hotel Check In-Hotel Fiesole Skippack, PA 7:00 p.m. Cocktails at Basta Pasta in Skippack 7:45 p.m. Dinner at Parc Bistro in Skippack 84. Records of Capital Wine and Spirits in reference to the July 15, 2010, Alliance Golf Open documented expenses incurred in the amount of $7,363.00. a. The document memorializing the cost of the event was updated on July 16, 2010. b. The invoice documented the expense breakdown as: Description Costs Food & Beverage $4,263.00 Golf $1,280.00 Golf Swag Bags $1,600.00 Forecaddies $220.00 Stapleton, 12-027 Page 28 Description Costs Total $7,363.00 c. The cost of the event to Capital Wine and Spirits and each Alliance supplier was approximately $1,840.75 ($7,363.00 ÷ 4). 85. Documented expenses associated with the 2010 Alliance Golf Open totaled a minimum of approximately $7,363.00. a. Fifteen (15) individuals participated in the 2010 Alliance Golf Open and incurred expenses totaling $7,363.00. Stapleton issued no personal payment to Capital Wine & Spirits and/or the Alliance Group for his participation in the outing. b. Stapleton asserts that he estimates the value of the golf outing as approximately $100.00 to $120.00, and that he did not avail himself of the entirety of the expenses as detailed above. 86. A third Alliance Open was arranged by Capital Wine & Spirits for officials of the PLCB in 2011. a. Mark Littles, Capital President extended an invitation to Conti and PLCB Chairman Patrick Stapleton. 87. Mark Littles of Capital Wine & Spirits sent an email to Conti and Stapleton on March 30, 2011, at 10:53 a.m. which included James Short, Marketing Director of the PLCB, along with Capital employees Robert Sirota, Cristina Desmond and Kevin McCarty. The subject of the e-mail was Alliance Meeting and included the following: PJ/Joe, On behalf of our Alliance partners, Bacardi, Brown Forman and Remy, I would like to Extend an invite to the PLCB Board, Joe, Jim and members of Jim’s team, to an Alliance Outdoor meeting at Philadelphia CC. We would like to see if either 7/14 or 7/21 would Work for you. The days [sic] agenda would be: Lunch 12-1 Outdoor Meeting 1-5 Dinner 6-8 This would all take place at Philadelphia CC. We could secure rooms at Marriott Conshohocken for anyone wanting to stay overnight. Please let us know which date works best for you and we can start setting up the details. Thank you, Mark 88. Sirota forwarded an e-mail on June 27, 2011, at 10:26 a.m. to Capital officials including Littles, Desmond, and McCarty regarding the third Alliance Open which included confirming the date of July 14 at the Philadelphia County Club. Stapleton, 12-027 Page 29 a. Desmond responded on June 27 at 11:00 a.m. as follows: “I have communicated this information to Jim (Short) and Matt (Schwenk). Kevin (McCarty) and Mark (Littles) should handle Joe (Conti), PJ (Stapleton), and Hitz.” 1. Doug Hitz is the PLCB Director of Planning and Procurement. 89. Littles sent another e-mail to Conti on June 27, 2011, 11:44 a.m. with the subject matter “Third Alliance Open–July 14” along with attachments, and included as follows: “Joe, here are the details on the Alliance meeting for 7/14. Thanks Mark” 90. The 2011 Alliance Golf Open was held at the Philadelphia Country Club, 1601 Spring Mill Road, Gladwyne, PA 19035 on July 14, 2011. a. The roster/itinerary for the 2011 Alliance Open identified the individuals participating as shown below: Group No. Player Affiliation #1 PJ Stapleton PLCB, Board Member/Chairman Mike Leibick Mark Brown-Forman, Vice President/Director Central States & Satterthwaite Canada Mark Littles Capital Wine & Spirits: The Charmer Sunbelt Group, President Group No. Player Affiliation #2 Joe Conti PLCB, Chief Executive Officer Mike Remitz Remy Cointreau USA, VP/Division Manager Todd Pemble Bacardi USA, Regional Director Matt Symanski Brown-Forman, Territory Sales Manager Group No. Player Affiliation #3 Jim Short PLCB, Director of Marketing Guillermo Bacardi, V.P./Managing Director - East Commercial Business Rodriguez Unit John Higgins Wirtz Beverage Nevada, Sales Manager Rob Sirota Capital Wine & Spirits: The Charmer Sunbelt Group, Director of Alliance Brands Group No. Player Affiliation #4 Matt Schwenk PLCB, Director of Product Selection Scott Pickford Bacardi USA Cristina Capital Wine & Spirits: The Charmer Sunbelt Group, Director Desmond of Marketing and Business Analytics Brad Moser Remy Cointreau USA, Regional Sales Manager Group No. Player Affiliation #5 Doug Hitz PLCB, Bureau Director Kevin McCarty Capital Wine & Spirits: The Charmer Sunbelt Group, VP Compliance & Administration Dave Franke Brown-Forman, State Manager PA/DE Rich Byrne Remy Cointreau, Field Marketing Director 1. Twenty individuals participated in the 2011 Alliance Open. b. The itinerary for the event documented the following activities: 11:00 a.m. Warm up/Range-PCC 11:30 a.m. Lunch-The Terrace 12:40 p.m. First Group Tee Time 12:50 p.m. Second Group Tee Time Stapleton, 12-027 Page 30 1:00 p.m. Third Group Tee Time 1:10 p.m. Fourth Group Tee Time 1:20 p.m. Fifth Group Tee Time 5:00 p.m.-6:30 p.m. Cocktails on the Terrace 5:00 p.m.-6:30 p.m. Hotel Check In-Conshohocken Marriot 7:00 p.m. Dinner at Philadelphia Country Club on the Terrace c. The itinerary for the event documented hotel accommodations available at the Marriott, 111 Crawford Ave, West Conshohocken, PA 19428. 91. PLCB attendees at the event included Short, Conti, Schwenk, Stapleton, and Doug Hitz, PLCB Bureau Director for Planning and Procurement. a. Pennsylvania is currently the largest purchaser of wine and spirits in the United States and is the second largest worldwide. The PLCB owns and operates over 600 state stores throughout the Commonwealth and is responsible for the purchase and distribution of all wine and spirits within the state. PLCB employees attend such events in order to develop relationships with vendors that supply product to the PLCB. 92. The 2011 Alliance Open was a marketing event sponsored by companies selling wine/spirits to the PLCB through Capital Wine and Spirits. a. Activities taking place at the 2011 Alliance Open included lunch, eighteen holes of golf, cocktails, and dinner. Stapleton asserted that he did not stay for the entirety of the event. 93. Records of Capital Wine and Spirits in reference to the July 14, 2011, Alliance Golf Open documented expenses incurred at the Philadelphia Country Club in the amount of $9,487.96. a. The banquet invoice generated by the Philadelphia Country Club (Booking No. 017299) documented a billing date of July 14, 2011. b. The invoice documented the expense breakdown as: Recap & Total Costs Services $2,691.55 Resources $6,037.00 Service Chg $592.14 Sales Tax $167.27 Total $9,487.96 c. Stapleton issued no personal payment that day to Capital Wine & Spirits and/or the Alliance Group for his participation in the outing. d. Stapleton asserts that he estimates the value of the golf outing as approximately $100.00 to $120.00, and that he did not avail himself of the entirety of the expenses as detailed above. 94. Stapleton asserts that he made a reasonable effort to ascertain the value of his round of golf and repay the full value of the golf. a. Stapleton asked one of the individuals associated with hosting the event how much he owed for the day. The individual responded that Stapleton did not owe anything, as Stapleton had hosted the individual the prior day for lunch and golf. Stapleton, 12-027 Page 31 95. The National Alcohol Beverage Control Association (“NABCA”) was established in 1938, and its mission is representing control state systems in those jurisdictions that directly control the distribution and sale of beverage alcohol within their borders. a. The mission of NABCA is to support member jurisdictions in their efforts to protect public health and safety and ensure responsible and efficient systems for beverage alcohol distribution and sales. b. One of the objectives of NABCA is to cultivate relationships between member jurisdictions, governmental entities, public health, industry, media and other organizations to encourage and facilitate communication and collaboration. c. The state of Pennsylvania is considered a control state. d. The PLCB is a member of NABCA. e. Stapleton is a Past-President of NABCA. 96. NABCA holds conferences each year alternating between the states of Arizona and Florida. 97. Stapleton, as a Board Member of the PLCB, regularly attended the NABCA Conferences. a. All of Stapleton’s expenses for attending conferences are paid for by NABCA. 1. NABCA, which is funded by the sale of data to the wine/spirit industry and dues paid by control jurisdictions, reimburses conference expenses for attendees. 98. Stapleton’s attendance at the NABCA Conferences, in addition to attending official NABCA events, included playing golf and having dinners which were paid for by one of the suppliers of the PLCB. a. Dinners and golf outings would be prearranged usually be e-mail between Stapleton and PLCB vendor officials. 99. Stapleton attended the 2010 NABCA Conference held in Marco Island, Florida, from May 15-19, 2010. 100. Stapleton attended the 2011 NABCA Conference held in Phoenix, Arizona on May 11, 2011, and participated in a golf outing at the Arizona Baltimore Golf Club th located at 24 Street & Missouri Avenue, P.O. Box 10719, Phoenix, AZ 85064. a. PLCB Supplier Brown-Forman paid for the cost of the golf outing which totaled $4,613.04 (approximately $128.14 per person). b. A total of ten (10) four-member teams played that included Stapleton and other control state officials. 101. Stapleton received meals sponsored/paid for by a PLCB vendor(s) at the 2011 NABCA Conference. Stapleton, 12-027 Page 32 a. Expense records of Mark Littles reflect Stapleton attending a dinner on May 13, 2011, at Mastro’s City Hall, along with James Short and Capital Managers. b. PLCB members are also reflected as attending a breakfast and drinks event hosted by Littles on May 15, 2011. 102. Stapleton attended the 2012 NABCA Conference held at the Marco Island Marriott Golf Resort, Naples, Florida, on May 18 and 19, 2012. a. Stapleton participated in golf outings on May 18 and 19, 2012, that were paid for by vendors of the PLCB. 1. The value of the May 18, 2012, golf outing arranged by White Rock Distributors could not be determined. 2. The value of the May 19, 2012 golf outing arranged by Brown-Forman was approximately $139.00 per person. THE FOLLOWING FINDINGS RELATE TO STAPLETON’S GENERAL RECEIPT OF GIFTS AND HOSPITALITY FROM VENDORS AT A TIME WHEN [HE] MADE DECISIONS AS TO THE PURCHASING, LISTING, AND DELISTING OF PRODUCT FROM THOSE VENDORS AND/OR SUPPLIERS. 103. While serving as the Chairman of the PLCB, Stapleton accepted meals/hospitality and/or gifts from Littles and/or Desmond, representatives of Capital Wine and Spirits. a. Littles’ expense summaries document meals/hospitality received and accepted by Stapleton as detailed in the chart below: Activity Date Net Amount Description Additional Text 07/21/2010 $460.75 Dinner PLCB New Store opening VIP New Hope, Marsha Browns, PJ Stapleton, event PLCB Board, Gina Gallo 07/22/2010 $1,354.33 Lunch, Meeting, Dinner PLCB New New Hope PLCB New Store Opening, PJ Store Opening Stapleton, Joe Conti, Tom Goldsmith, Bob Marcus, CWS Managers, Golf, Lunch, Dinner 12/15/2010 $642.60 Dinner, Drinks, PLCB Buyers, Dan Elements, Pittsburgh, PLCB Buyers, Infinium, Ankroyd visit CWS 03/14/2011 $67.24 Lunch Meeting, PJ Stapleton, PLCB Le Castagne Chairman 05/07/2011 $1,050.16 PLCB Wine Festival Dinner with Barclay Prime, Tom Goldsmith and Wife, Joe PLCB Board Members Conti and Wife, B. Pio and Wife, L. Sutow and Wife 05/13/2011 $888.49 Dinner Mastro’s City Hall, Scottsdale, AZ NACBA, PLCB Members NABCA Meetings J Short, PJ Stapleton, CWS Managers 05/15/2011 $540.82 Breakfast and Drinks w PLCB Arizona Biltmore At NABCA 05/10--05/15 PLCB Board Members, Buyer J Short, CWS Managers / NABCA Meeting 05/25/2011 $2,974.39 PLCB Holiday Presentation Dinner Davios & Parc, Philadelphia, PA Bacardi/B-F 50% e PLCB Holiday Presentation Dinner Bill Back 50% to Bacardi and 50% to Brown Forman Stapleton, 12-027 Page 33 Activity Date Net Amount Description Additional Text 05/26/2011 $767.52 PLCB Bachanal Dinner Launch, Osteria, PJ Stapleton, CWS Managers, PAFA PAFA Dinner b. Stapleton asserts that he was not present and did not avail himself of the meals and/or hospitality provided on May 7, 2011, May 13, 2011, May 15, 2011 and May 25, 2011. c. Desmond’s expense summaries documented the purchase of picture frames on September 14, 2009, in the amount of $172.25, of which one was provided as a gift to Stapleton. 1. The specific value of the frame received by Stapleton could not be determined. 2. Desmond documented the expense on her employee expense report for reimbursement and received reimbursement for said expense. 104. Stapleton accepted the meals/hospitality and gift from Littles and/or Desmond respectively at a time when Stapleton was responsible for making decisions as a PLCB Board Member regarding product listing and delisting of products from suppliers represented by Capital Wine and Spirits. a. The specific value of the meals/hospitality received by Stapleton from Littles could not be determined. b. The specific value of the gift received and accepted by Stapleton from Desmond, a PLCB vendor representative, could not be determined. c. Stapleton made no personal payment for the meals/hospitality and/or gifts. 105. Expense reports filed by Brad Waxman (representative of Southern Wine and Spirits) document Stapleton attending a dinner on or about March 3, 2009. a. Waxman paid for the meal totaling $385.29. b. Stapleton asserts that he was not present at this event. 106. While serving in the position of Chairman of the PLCB, Stapleton accepted at least one meal from Mark Sweeney, a representative of Southern Wine and Spirits at that time, on September 16, 2011. a. Written on the receipt in handwriting was “Multi Cultural Meeting and Intro To PLCB.” b. Sweeney paid for lunch in the amount of $131.20 for himself, Stapleton, and four additional attendees on September 16, 2011, at the Continental Midtown, in Philadelphia, Pennsylvania. 1. Sweeney issued payment for the expenses incurred via use of his corporate issued credit card. 2. Southern Wine and Spirits employees are permitted to receive reimbursement from the company for legitimate business expenses incurred. Stapleton, 12-027 Page 34 3. Southern Wine and Spirits employees may not receive reimbursement for personal expenses incurred. c. Sweeney received reimbursement for the meal expense incurred for Stapleton and the additional attendees. 107. Stapleton accepted the meal from Sweeney at a time when Stapleton was responsible for making decisions as a PLCB Board Member regarding product listing and delisting of products from suppliers represented by Southern Wine and Spirits. a. Absent Stapleton’s office as a PLCB Board Member, Stapleton would not have been in a position to receive the meal from Sweeney, a PLCB vendor representative. b. Stapleton made no personal payment for the meal. 108. While serving in the position of Chairman of the PLCB, Stapleton received and accepted meals/hospitality from representatives of White Rock Distilleries, a supplier of alcohol/spirits to the Commonwealth. a. Email transmission from Brungo to Paul Coulombe, White Rock Distilleries owner/Chief Executive Officer, dated May 9, 2011, at 12:41 p.m. bearing the subject of “Jim Short Dinner” detailed the following: 1. Hi Paul, I wanted to confirm with you the details of your smaller dinner with Jim Short. You will have a limo with White Rock Distilleries in the window outside the main lobby doors at 7:00 pm. You have a dinner reservation at Maestro’s City Hall, 6991 East Camelback Road at 7:45 pm for 8 people. I will change the dinner reservation to 5 or 6 people, depending on if you will have a guest. The guests are as follows: Paul C, Paul D, Cristina Desmond, Kevin McCarty and Jim Short. PJ Stapleton and Mark Littles would like to join you for a cocktail after dinner that evening. I have copied Sean Doherty on this email, as he is waiting to hear back from RNDC regarding a few bar locations in the area. Please let me know if you have any questions at all. See you in Phoenix! Trish b. The expenses were ultimately paid for by White Rock Distilleries. 109. Stapleton accepted the meals/hospitality from White Rock Distilleries representatives while Stapleton, as PLCB Chairman, was responsible for making decisions regarding product listing and delisting of products from suppliers represented by White Rock Distilleries. a. The specific value of the meals/hospitality received and accepted by Stapleton from White Rock Distilleries representatives could not be determined. Stapleton, 12-027 Page 35 b. Stapleton made no personal payment for the meals/hospitality and/or gifts. 110. While serving in the position of Chairman of the PLCB, Stapleton accepted the following from Erin Schiller, a representative of Beam Global Wine and Spirits, identified by Schiller on his business expense reports as detailed in the chart below: Date Description of Expense Expense Individuals Amount Present/Benefactor 07/31/2011 PLCB – Phillies Game @ Aramark $53.75 Stapleton & Daughter Citizens Bank Park Schiller & Daughter 09/14/2011 Wine & Spirits $395.26 Stapleton a. Expenses incurred by Schiller as a representative of Beam Global for attendance at the Philadelphia Phillies game on July 31, 2011, included $16.50 for parking and $37.25 for meals. b. Wine and spirits purchased by Schiller as a representative of Beam Global on September 14, 2011, which were given to Stapleton included the following: Description Quantity Price Skinny Girl Mrgrt 1 $13.99 Maker’s Mark 1 $34.99 S Oak Cab Sauv Alx 1 $48.99 Cruzan 9 Spiced Rum 1 $14.99 Pucker Grape Gone 1 $15.99 Basil Haydens Bourbon 1 $37.99 Effen Vodka 1 $22.99 Laphroaig 18 1 $59.99 Chocolate Shp red 1 $12.99 Ehlers Estate 1886 1 $49.99 Pina CS D’Adamo 1 $34.99 Jim Beam Devils Cut 1 $24.99 Tax $22.38 Total $395.26 c. Schiller issued payment for the expenses incurred via use of his corporate issued credit card. d. The expenses were ultimately paid for by Beam Global Wine and Spirits. 111. Stapleton accepted the meal/gifts from Schiller while Stapleton had responsibility for making decisions as a PLCB Board Member regarding product listing and delisting of products from Beam Global Wine and Spirits, a supplier of alcohol/spirits to the Commonwealth of Pennsylvania. 112. In an interview with Commission representatives on July 15, 2013, Stapleton claimed, in part, the following: a. Stapleton has become more familiar with the Pennsylvania Liquor Code since his service ended as a PLCB Member. 1. Stapleton is a licensed attorney within the Commonwealth of Pennsylvania (PA Attorney ID 38057). 2. Stapleton is a partner in the law firm of Weber, Gallagher, Simpson, Stapleton, Fires & Newby, L.L.P. Stapleton, 12-027 Page 36 b. Stapleton was generally aware that acceptance of gifts, gratuities, hospitality, etc., by PLCB representatives, including Board Members, from individuals and/or entities having or attempting to secure business with the PLCB was illegal and therefore prohibited; however, Stapleton was not clear on the extent/parameters of the prohibitions. 1. Stapleton had conversations with PLCB Chief Counsel Faith Diehl during which Diehl stated that acceptance of gifts at times was appropriate and at other times was not. 113. During an interview with Commission investigators on July 15, 2013, Stapleton provided responses to questions posed regarding the general subject of acceptance of gifts and hospitality by PLCB representatives as well as his view of PLCB operations, including, in part, the following: a. Stapleton was questioned on the appropriateness of PLCB representatives involved [in] product decisions participating in golf outings with vendors at no cost to the PLCB representatives. 1. Stapleton responded, “This is how the real world works if it’s not the PLCB.” 2. Stapleton added that the PLCB is essentially a business and that he tried to run it as a business during his tenure on the board. 3. Stapleton stated that participation in the golf outings by PLCB representatives provided exposure to individuals in the industry that they may not be exposed to otherwise. 4. Stapleton admitted that it was not necessary for PLCB representatives to meet with vendor representatives on the golf course but, “it helped.” b. Stapleton was questioned on his personal knowledge/relationship with any PLCB vendors prior to his service on the PLCB Board. 1. Stapleton stated that he had no personal relationship with any PLCB vendors prior to his service on the PLCB Board. 2. Stapleton attempted to maintain relationships that were advantageous to the PLCB. 114. Stapleton, in his official capacity as a Board Member of the PLCB, was annually required to file a Statement of Financial Interests (“SFI”) [disclosing] information for the prior calendar year. a. Stapleton was required to file an SFI for each year he served as a Board Member. 115. Statements of Financial Interests were filed with the State Ethics Commission by Stapleton for calendar years 2007 through 2012. 2012 a. Calendar Year: Filed: 04/29/13 on form SEC-1 REV. 01/13 2011 b. Calendar Year: Stapleton, 12-027 Page 37 Filed: 04/27/12 on form SEC-1 REV. 01/12 2010 c. Calendar Year: Filed: 04/29/11 on form SEC REV. 01/11 2009 d. Calendar Year: Filed: 04/30/10 on form SEC-1 REV. 01/10 2008 e. Calendar Year: Filed: Not date stamped, on form SEC-1 REV. 01/09, form dated 04/30/09 1. Amended Filing: 05/07/09 on form SEC-1 REV. 01/09 Amended Filing 2007 f. Calendar Year: Filed: 05/01/09, on form SEC-1 REV. 01/08 2007 1. Additional Calendar Year: Filed: 06/04/09, on form SEC-1 REV. 01/08 116. Stapleton failed to disclose hospitality on his SFI for calendar years 2010 and 2011 as follows: a. In 2010, Stapleton failed to list [under transportation, lodging and hospitality] that he played in the AT&T Pro-Am Tournament held at Aronimink Golf Club as a guest of PLCB suppler, Bacardi USA, for which the value was in excess of $650.00. b. In 2011, Stapleton failed to list [under transportation, lodging and hospitality] that he played in the AT&T Pro-Am Tournament held at Aronimink Golf Club as a guest of PLCB supplier Bacardi USA, for which the value was in excess of $650.00. c. When combined with other hospitality received by the same source (vendors) in any given calendar year, total hospitality received by Stapleton may have exceeded the $650.00 reporting threshold. 117. Patrick Stapleton, in his position as Member and Chairman of the PLCB, used the authority of his office to realize a private pecuniary benefit for himself and a business with which he is associated (Keystone Weekend) when he accepted gifts, transportation, lodging, and/or hospitality from vendors and/or brokers and suppliers of the PLCB at a time when Stapleton was participating in and making decisions regarding the PLCB's purchase of wine and spirits from those same vendors and/or brokers and suppliers. Stapleton, 12-027 Page 38 DescriptionValue $1,200.00 2010 AT&T Pro Am (Capital) $1,200.00 2011 AT&T Pro Am (Capital) $ 965.27 2010 & 2011 Alliance Outings (Capital) 1 $3,004.87 Keystone Weekend 2008-2012 $ 128.14 Golf at 2011 NABCA (Capital) $ 139.00 Golf at 2102 NABCA (Capital) $ 172.25 Picture Frame, Cristina Desmond (Capital) $ 449.01 Hospitality/alcohol Erin “Red” Schiller (Bacardi) Total$7,258.54 III.DISCUSSION: As a Member of the Pennsylvania Liquor Control Board (“PLCB”) from approximately June 17, 1997, through October 5, 2012, Respondent Patrick Stapleton (also referred to herein as “Respondent,” “Respondent Stapleton,” and “Stapleton,” has been a public official subject to the provisions of the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq. The allegations are that Respondent Stapleton, as a Member and Chairman of the PLCB, violated Sections 1103(a) and 1105(b) of the Ethics Act: (1) when he used the authority of his public position for the private pecuniary benefit of himself, members of his immediate family, and/or a business with which he and/or members of his immediate family are/were associated by soliciting from PLCB vendor(s) donations of wine and/or liquor for events hosted by the Keystone Weekend Inc., an entity with which Stapleton and/or members of his immediate family are/were associated; (2) when he solicited vendor(s) of the PLCB to arrange for and provide a celebrity chef(s) for the same event; (3) when he received hospitality--including but not limited to lunches, dinners, and golf outings (which included cocktails, meals, greens fees and other amenities)--paid for by PLCB vendor(s), all at a time when the vendor(s) had an ongoing business/contractual relationship with the PLCB; and (4) when he failed to disclose on Statements of Financial Interests (“SFIs”) for the 2010 and 2011 calendar years the receipt of gifts, transportation, hospitality and/or lodging from vendor(s) of the PLCB. Pursuant to Section 1103(a) of the Ethics Act, a public official/public employee is prohibited from engaging in conduct that constitutes a conflict of interest: § 1103. Restricted activities (a)Conflict of interest.— No public official or public employee shall engage in conduct that constitutes a conflict of interest. 65 Pa.C.S. § 1103(a). The term "conflict of interest" is defined in the Ethics Act as follows: § 1102. Definitions "Conflict" or "conflict of interest." Use by a public official or public employee of the authority of his office or employment or any confidential information received through his holding public office or employment for the private 1 Value for actual determinable value of alcohol donated year 2011 ($1,581.51) and estimated value year 2012 ($1,423.36). Stapleton, 12-027 Page 39 pecuniary benefit of himself, a member of his immediate family or a business with which he or a member of his immediate family is associated. The term does not include an action having a de minimis economic impact or which affects to the same degree a class consisting of the general public or a subclass consisting of an industry, occupation or other group which includes the public official or public employee, a member of his immediate family or a business with which he or a member of his immediate family is associated. 65 Pa.C.S. § 1102. Section 1103(a) of the Ethics Act prohibits a public official/public employee from using the authority of public office/employment or confidential information received by holding such a public position for the private pecuniary benefit of the public official/public employee himself, any member of his immediate family, or a business with which he or a member of his immediate family is associated. Section 1105(b) of the Ethics Act and its subsections detail the financial disclosure that a person required to file the SFI form must provide. Subject to certain statutory exceptions not applicable to this matter, Section 1105(b)(6) of the Ethics Act requires the filer to disclose on the SFI the name and address of the source and the amount of any gift or gifts valued in the aggregate at $250 or more and the circumstances of each gift. Subject to certain statutory exceptions not applicable to this matter, Section 1105(b)(7) of the Ethics Act requires the filer to disclose on the SFI the name and address of the source and the amount of any payment for or reimbursement of actual expenses for transportation and lodging or hospitality received in connection with public office or employment where such actual expenses exceed $650 in an aggregate amount per year. As noted above, the parties have submitted a Consent Agreement and Stipulation of Findings. The parties' Stipulated Findings are set forth above as the Findings of this Commission. We shall now summarize the relevant facts as contained therein. Stapleton served as a Member of the PLCB from approximately June 17, 1997, through October 5, 2012. Stapleton served as Chairman of the PLCB from approximately January 17, 2007, through October 5, 2012. The PLCB is governed by a three-Member Board. The PLCB regulates the sale of alcohol in Pennsylvania. In order for an alcoholic beverage to be sold in Pennsylvania, it must be authorized for sale by the PLCB. The PLCB is the only retail seller of wine/spirits/beer in the Commonwealth. The PLCB adds and removes products sold in PLCB retail stores through a process known as “listing” and “delisting.” The parties have stipulated that the PLCB Director of Marketing and Merchandising, Chief of the Product Management and Pricing Division, and Merchandising Pricing Coordinator(s) are usually responsible for evaluating new products. The Director of Marketing and Merchandising and the Chief of the Product Management and Pricing Division make the final recommendation to the PLCB Board Members as to what product(s) should be listed or delisted. PLCB Board Members vote on the entire recommended new product list without any independent review of the product/support data. A manufacturer/supplier of alcoholic beverage products may market its products to the PLCB directly or through a vendor or broker. The primary vendors providing products Stapleton, 12-027 Page 40 to the PLCB are: (1) Southern Wine and Spirits (“Southern”); (2) Capital Wine and Spirits (“Capital”); and (3) Allied Beverage Group, LLC (“Allied”), which has a subsidiary named “Majestic Wine & Spirits, USA, LLC” (“Majestic”). Products for which Southern serves as broker and/or vendor/vendor of record account for approximately 6.43% to 6.85% of the PLCB total Cost of Goods Sold during the last five (5) years. A list of Southern’s business with the PLCB is detailed in Fact Finding 25 c. Capital is a member of the “Charmer Sunbelt Group,” a nationwide distributor of wine, spirits, beer, and other beverages. Products brokered by Capital account for a total of approximately 19.11% to 22.03% of the PLCB total Cost of Goods Sold during the last five (5) years. A list of Capital’s business with the PLCB is detailed in Fact Finding 28 b. In Pennsylvania, Capital/Charmer Sunbelt Group represents a marketing partnership named “the Alliance,” which is comprised of wine/spirit suppliers Bacardi USA (“Bacardi”), Brown Forman, and Remy Cointreau (“Remy”). Capital also represents White Rock Distilleries, a supplier of alcohol/spirits to the Commonwealth of Pennsylvania. Allied was created by the mergers of The Baxter Group, Inc., F&A Distributing Company and The Jaydor Corporation. Allied ranks among the ten largest wine and spirits distributors in the United States. Allied subsidiary Majestic is a Pennsylvania brokerage and vendor/vendor of record for products sold to the PLCB. Allied’s and/or Majestic’s sales account for approximately 1.51% to 2.18% of PLCB total Cost of Goods Sold during the last five (5) years. A list of Majestic’s business with the PLCB is detailed in Fact Finding 36 a. Executives and marketing representatives from vendors supplying products to the PLCB would meet with PLCB officials and employees to market products. Those representatives offered gifts and hospitality to PLCB representatives, including Stapleton. These items were offered when listing/delisting of products was occurring. Items of value were routinely provided to PLCB officials involved with product selection and placement. As Chairman of the PLCB, Stapleton interacted and met with representatives of vendors, brokers and suppliers of the PLCB. Stapleton would meet with suppliers/brokers at the offices of the PLCB, store openings, golf outings, and dinner meetings at restaurants. Individuals that Stapleton as PLCB Chairman had specific dealings with included: Mark Littles, President of Capital; Cristina Desmond, Director of Marketing and Business Analytics for Capital; Tricia Brungo, Control State Manager for White Rock Distilleries; Mark Sweeney, Vice President of Sales in Pennsylvania for Diageo; Christopher Papariello, Executive Vice-President of Majestic; Erin “Red” Schiller, Jim Bean Global; and Brad Waxman, Southern. These individuals and other vendor marketing representatives provided Stapleton with gifts, meals, alcohol donations and golf outings during his tenure with the PLCB. In a private capacity, Stapleton is associated with a 501(c)(3) non-profit corporation named the “Keystone Weekend, Inc.” (“Keystone Weekend”), which Stapleton and his then wife, Kelly Beaudin Stapleton, established in 2008. Stapleton has been an officer/director for the Keystone Weekend since its inception in 2008. The Keystone Weekend is an annual, private function that can only be attended by invitation. There is a registration fee for those planning to attend. Meals, including meals prepared by celebrity chefs, and alcoholic beverages are provided as part of the Keystone Weekend. PLCB vendors including Capital, Southern and Majestic have donated alcohol to the Keystone Weekend at no charge to Stapleton and/or the Keystone Weekend. Stapleton has acknowledged that he and/or his representatives, at his direction, informed vendors of other vendors donating alcohol to the events and inquired as to their interest in supplying Stapleton, 12-027 Page 41 donations as well. Stapleton and/or his representatives acting at his direction informed the vendors of the amount of alcohol needed to accommodate certain number(s) of individuals. The quantities and sources for all alcohol donations to the 2008–2010 Keystone Weekends were not ascertainable. For the 2011 Keystone Weekend, Stapleton or others acting at his direction accepted donations of alcohol from PLCB vendors valued at in excess of $1,581.51, as detailed in Fact Findings 50 a-b. For the 2012 Keystone Weekend, the estimated value of the alcohol donated to the Keystone Weekend by PLCB vendors was $1,423.36. Fact Finding 117. As a vendor of the PLCB, Capital invited Stapleton, PLCB Board Member Robert Marcus, and PLCB Chief Executive Officer Joe Conti (“Conti”) to participate in the 2010 AT&T Pro-Am Tournament (“2010 Pro-Am Tournament”) held as part of The AT&T National Golf Tournament (“AT&T Tournament”) at Aronimink Golf Club. Littles provided the invitation to Stapleton, Marcus and Conti at a time when Capital had an ongoing business relationship with the PLCB as a broker for multiple products listed/pending listing before the PLCB. The ticket used by Stapleton was provided by Bacardi, USA, a sponsor of the AT&T Tournament. Capital serves as a broker for Bacardi in Pennsylvania. Stapleton played in the 2010 Pro-Am Tournament on June 28, 2010. The packaged benefits made available to each golfer are detailed in Fact Finding 67. Stapleton asserts that he did not avail himself of the “Pro-Am gift package” valued at a total of $197.62. The other packaged benefits included food, beverages, and recreation/entertainment. Fact Finding 67. Stapleton provided Littles with a $160.00 cash payment as payment for the 2010 Pro-Am Tournament. Stapleton estimated the approximate cost of the value of his round of golf based upon his being a member of Aronimink and not availing himself of the full benefits package. However, Aronimink Golf Club members were not given the opportunity for any discounts for playing in the 2010 Pro-Am Tournament. Stapleton’s $160.00 payment received by Capital was donated to the American Diabetes Association. The parties have stipulated that the value that Stapleton received by playing in the 2010 Pro- Am Tournament was $1,200.00. Fact Findings 60 c, 117. As a vendor of the PLCB, Capital invited Stapleton and Conti to participate in the 2011 AT&T Pro-Am Tournament (“2011 Pro-Am Tournament”) held as part of The AT&T Tournament at Aronimink Golf Club. Littles provided the invitation to Stapleton and Conti at a time when Capital had an ongoing business relationship with the PLCB as a broker for multiple products listed/pending listing before the PLCB. Tickets were provided by Bacardi, USA, a sponsor of the AT&T Tournament. As noted above, Capital serves as a broker for Bacardi in Pennsylvania. Stapleton played in the 2011 Pro-Am Tournament on June 29, 2011. The packaged benefits made available to each golfer are detailed in Fact Finding 74. Stapleton asserts that he did not avail himself of the “Pro-Am VIP gift package” valued at a total of $487.70. The other packaged benefits included food, beverages, and recreation/entertainment. Fact Finding 74. Stapleton asserted that he issued payment to Littles in the amount of $300.00 in association with his playing in the 2011 Pro-Am Tournament. Stapleton estimated the approximate cost of the value of his round of golf based upon his being a member of Aronimink. However, Aronimink Golf Club members were not given the opportunity for any discounts for playing in the 2011 Pro-Am Tournament. The parties have stipulated that the value that Stapleton received by playing in the 2011 Pro-Am Tournament was $1,200.00. Fact Findings 60 c, 117. In 2009, 2010, and 2011, Capital/Alliance held golf outings referred to as the Stapleton, 12-027 Page 42 “Alliance Golf Open,” which included officials of the PLCB. The Alliance Golf Open was organized as a means by which Capital and the Alliance suppliers could strengthen their relationship with the PLCB and to allow various Alliance senior management officials to have “face time” with PLCB officials. Stapleton did not participate in the 2009 Alliance Golf Open. Stapleton participated in the 2010 Alliance Golf Open and the 2011 Alliance Golf Open. These events included a warm up session, lunch, a round of golf, and dinner. Although Stapleton asserted that the event(s) had a business purpose, no specific time slot was reserved for any specific business/product presentations by Capital and/or the Alliance suppliers at the events. The costs associated with the 2010 and 2011 Alliance Golf Open were divided into four equal amounts paid by Capital, Bacardi, Brown Forman, and Remy. The 2010 Alliance Golf Open was held at the River Crest Golf Club in Phoenixville, Pennsylvania, on July 15, 2010. The cost of the golf outing totaled $7,363.00 for the fifteen participants. The 2011 Alliance Golf Open was held at the Philadelphia Country Club in Gladwyne, Pennsylvania, on July 14, 2011. The cost of the golf outing totaled $9,487.96 for the twenty participants. The parties have stipulated that Stapleton realized a private pecuniary gain of $965.27 from his participation at the 2010 Alliance Golf Open and the 2011 Alliance Golf Open. Fact Finding 117. The PLCB is a member of the National Alcohol Beverage Control Association (“NABCA”). NABCA represents control state systems in those jurisdictions that directly control the distribution and sale of beverage alcohol within their borders. NABCA holds conferences each year alternating between Arizona and Florida. At the 2011 NABCA Conference held in Phoenix, Arizona, Stapleton participated in a golf outing paid for by PLCB supplier Brown-Forman. The cost of the golf outing totaled $4,613.04 (approximately $128.14 per person). Stapleton also received meals sponsored/paid for by Mark Littles of Capital. At the 2012 NABCA Conference held in Naples, Florida, Stapleton participated in golf outings on May 18 and 19, 2012, which were paid for by PLCB vendors. The value of the May 18, 2012, golf outing arranged by White Rock Distributors could not be determined. The value of the May 19, 2012, golf outing arranged by Brown-Forman was approximately $139.00 per person. While serving as Chairman of the PLCB, Stapleton accepted hospitality and/or gifts from Littles and/or Desmond, representatives of Capital. The specific value of the hospitality received by Stapleton from Littles could not be determined. Desmond’s expense summaries documented the purchase of picture frames on September 14, 2009, in the amount of $172.25, of which one was provided as a gift to Stapleton. The specific value of the frame received by Stapleton could not be determined. Stapleton accepted the hospitality and gift from Littles and/or Desmond at a time when Stapleton was responsible for making decisions as a PLCB Board Member regarding listing and delisting of products from suppliers represented by Capital. In 2011, while serving as Chairman of the PLCB, Stapleton accepted from Erin Schiller, a representative of Beam Global Wine and Spirits, hospitality/gifts valued at $53.75 for parking and meals at a Philadelphia Phillies game on July 31, 2011, and wine and spirits totaling $395.26 on September 14, 2011, as detailed in Fact Findings 110-110 b. The expenses were ultimately paid for by Beam Global Wine and Spirits. Stapleton accepted the hospitality/gifts from Schiller while Stapleton had responsibility for making decisions as a PLCB Board Member regarding listing and delisting of products from Beam Stapleton, 12-027 Page 43 Global Wine and Spirits, a supplier of alcohol/spirits to the Commonwealth of Pennsylvania. As detailed in the Fact Findings, while serving as Chairman of the PLCB, Stapleton accepted additional hospitality from representatives of vendors/brokers/suppliers doing business with the PLCB at a time when Stapleton was responsible for making decisions as a PLCB Board Member regarding listing and delisting of products. Absent Stapleton’s office as a PLCB Board Member, Stapleton would not have been in a position to receive such hospitality. The parties have stipulated that Stapleton, in his position as Member and Chairman of the PLCB, used the authority of his office to realize a private pecuniary benefit of $7,258.54, calculated as the sum of the items listed below, for himself and a business with which he is associated (Keystone Weekend) when he accepted gifts, transportation, lodging, and/or hospitality from vendors and/or brokers and suppliers of the PLCB at a time when Stapleton was participating in and making decisions regarding the PLCB's purchase of wine and spirits from those same vendors and/or brokers and suppliers: DescriptionValue $1,200.00 2010 AT&T Pro Am (Capital) $1,200.00 2011 AT&T Pro Am (Capital) $ 965.27 2010 & 2011 Alliance Outings (Capital) 2 $3,004.87 Keystone Weekend 2008-2012 $ 128.14 Golf at 2011 NABCA (Capital) $ 139.00 Golf at 2102 NABCA (Capital) $ 172.25 Picture Frame, Cristina Desmond (Capital) $ 449.01 Hospitality/alcohol Erin “Red” Schiller (Bacardi) Total$7,258.54 As for Stapleton’s SFIs, the parties have stipulated that for Stapleton’s SFIs for calendar years 2010 and 2011, Stapleton failed to list under transportation, lodging and hospitality that he played in the AT&T Pro-Am Tournament held at Aronimink Golf Club as a guest of PLCB suppler, Bacardi USA, for which the value was in excess of $650.00. The parties have further stipulated that when combined with other hospitality received by the same source (vendors) in any given calendar year, total hospitality received by Stapleton may have exceeded the $650.00 reporting threshold. Having highlighted the Stipulated Findings and issues before us, we shall now apply the Ethics Act to determine the proper disposition of this case. The parties' Consent Agreement sets forth a proposed resolution of the allegations as follows: 3. The Investigative Division will recommend the following in relation to the above allegations: a. That a transgression of Section 1103(a) of the Public Official and Employee Ethics Act, 65 Pa.C.S. § 1103(a), occurred in relation to Stapleton’s acceptance of donations of alcoholic beverage (e.g. wine, spirits, liquor, etc.) for consumption at events hosted by the Keystone Weekend Inc., a 501(c)(3) entity with which 2 Value for actual determinable value of alcohol donated year 2011 ($1,581.51) and estimated value year 2012 ($1,423.36). Stapleton, 12-027 Page 44 Stapleton is associated, when the entity donating alcoholic products had ongoing contractual relationships with the PLCB, and Stapleton was a Member and Chairman of the PLCB; b. That a transgression of Section 1103(a) of the Public Official and Employee Ethics Act, 65 Pa.C.S. § 1103(a), occurred in relation to Stapleton’s acceptance of hospitality (meals, golf outings, beverages) provided by various vendors who had ongoing contractual relationships with the PLCB, and Stapleton was a Member and Chairman of the PLCB; c. That a violation of Section 1105(b) of the Public Official and Employee Ethics Act, 65 Pa.C.S. § 1105(b), occurred in relation to Stapleton’s omission to report receipt of gifts and hospitality, as enumerated in paragraphs “a” and “b” above, from vendor(s) of the PLCB, upon Statements of Financial Interests filed for the 2010 and 2011 calendar years. 4. Stapleton agrees to make payment in the amount of $7,258.54 in settlement of this matter payable to the Commonwealth of Pennsylvania and forwarded to the Pennsylvania State Ethics Commission within thirty (30) days of the issuance of the final adjudication in this matter. 5. Stapleton agrees to file complete and accurate Statements of Financial Interests with the Pennsylvania Liquor Control Board through the Pennsylvania State Ethics Commission, for the 2010 and 2011 calendar years within thirty (30) days of the issuance of the final adjudication in this matter. 6. Stapleton agrees to not accept any reimbursement, compensation or other payment from the Pennsylvania Liquor Control Board representing a full or partial reimbursement of the amount paid in settlement of this matter. 7. The Investigative Division will recommend that the State Ethics Commission take no further action in this matter; and make no specific recommendations to any law enforcement or other authority to take action in this matter. Such, however, does not prohibit the Commission from initiating appropriate enforcement actions in the event of Respondent's failure to comply with this agreement or the Commission's order or cooperating with any other authority who may so choose to review this matter further. Consent Agreement, at 2. In considering the Consent Agreement, we accept the recommendation of the parties for a finding that a transgression of Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), occurred in relation to Stapleton’s acceptance of donations of alcoholic beverages, such as wine, sprits, liquor and the like, for consumption at events hosted by Stapleton, 12-027 Page 45 the Keystone Weekend Inc., a 501(c)(3) entity with which Stapleton is associated, when the entity donating alcoholic products had ongoing contractual relationships with the PLCB and Stapleton was a Member and Chairman of the PLCB. The acceptance of gifts, transportation, lodging or hospitality from donor(s) with which a public official/public employee has involvement in his public capacity can form the basis for a conflict of interest under Section 1103(a) of the Ethics Act. See, Cohen, Opinion 03-006 (regarding a PLCB Hearing Examiner’s prospective acceptance of item(s) from licensees); see, e.g., Haldeman, Order 1443; Munford, Order 1390; Espenshade, Order 1387. As Chairman of the PLCB, Stapleton interacted and met with representatives of vendors, brokers and suppliers of the PLCB. These individuals provided Stapleton with gifts, meals, alcohol donations and golf outings during Stapleton’s tenure with the PLCB. The parties have stipulated that Stapleton, in his position as Member and Chairman of the PLCB, used the authority of his office to realize a private pecuniary benefit of $7,258.54, calculated as the sum of the items listed in Fact Finding 117, for himself and a business with which he is associated, Keystone Weekend, when he accepted gifts, transportation, lodging, and/or hospitality from vendors and/or brokers and suppliers of the PLCB at a time when Stapleton was participating in and making decisions regarding the PLCB's purchase of wine and spirits from those same vendors and/or brokers and suppliers. Of the aforesaid total private pecuniary benefit of $7,258.54, the amount of $3,004.87 was for alcohol donated by PLCB vendors, and received by Stapleton or by others at Stapleton’s direction, for use at the Keystone Weekend in 2011 and 2012. We hold that a transgression of Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), occurred in relation to Stapleton’s acceptance of donations of alcoholic beverages, such as wine, sprits, liquor and the like, for consumption at events hosted by the Keystone Weekend Inc., a 501(c)(3) entity with which Stapleton is associated, when the entity donating alcoholic products had ongoing contractual relationships with the PLCB and Stapleton was a Member and Chairman of the PLCB. Likewise, based upon the Stipulated Findings set forth above, we accept the recommendation of the parties and we hold that a transgression of Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), occurred in relation to Stapleton’s acceptance of hospitality (meals, golf outings, beverages) provided by various vendors who had ongoing contractual relationships with the PLCB, while Stapleton was a Member and Chairman of the PLCB. We agree with the parties, and we hold, that a violation of Section 1105(b) of the Ethics Act, 65 Pa.C.S. § 1105(b), occurred in relation to Stapleton’s omission from his SFIs filed for the 2010 and 2011 calendar years of reportable information as to his receipt of gifts and hospitality from vendor(s) of the PLCB. The omitted items included reportable information under the category of transportation, lodging and hospitality regarding Stapleton’s participation in the 2010 Pro-Am Tournament and the 2011 Pro-Am Tournament as a guest of PLCB suppler, Bacardi USA. It appears that the Investigative Division in the exercise of its prosecutorial discretion has elected to non pros the portion of the allegations pertaining to solicitation of vendor(s) of the PLCB to arrange for and provide celebrity chef(s) for the Keystone Weekend. As part of the Consent Agreement, Stapleton has agreed to make payment in the amount of $7,258.54 payable to the Commonwealth of Pennsylvania and forwarded to this Commission within thirty (30) days of the issuance of the final adjudication in this matter. Stapleton, 12-027 Page 46 Stapleton has also agreed to not accept any reimbursement, compensation or other payment from the PLCB representing a full or partial reimbursement of the amount paid in settlement of this matter. Stapleton has further agreed to file complete and accurate SFIs for calendar years 2010 and 2011 with the PLCB, through this Commission, within thirty (30) days of the issuance of the final adjudication in this matter. We determine that the Consent Agreement submitted by the parties sets forth a proper disposition for this case, based upon our review as reflected in the above analysis and the totality of the facts and circumstances. Accordingly, per the Consent Agreement of the parties, Stapleton is directed to make payment in the amount of $7,258.54 payable to the Commonwealth of Pennsylvania th and forwarded to this Commission by no later than the thirtieth (30) day after the mailing date of this adjudication and Order. Per the Consent Agreement of the parties, Stapleton is further directed to not accept any reimbursement, compensation or other payment from the PLCB representing a full or partial reimbursement of the amount paid in settlement of this matter. To the extent he has not already done so, Stapleton is directed to file complete and accurate SFIs for calendar years 2010 and 2011 with the PLCB, through this Commission, th by no later than the thirtieth (30) day after the mailing date of this adjudication and Order. Compliance with the foregoing will result in the closing of this case with no further action by this Commission. Noncompliance will result in the institution of an order enforcement action. IV.CONCLUSIONS OF LAW: 1. As a Member of the Pennsylvania Liquor Control Board (“PLCB”) from approximately June 17, 1997, through October 5, 2012, Respondent Patrick Stapleton (“Stapleton”) has been a public official subject to the provisions of the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq. 2. A transgression of Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), occurred in relation to Stapleton’s acceptance of donations of alcoholic beverages, such as wine, sprits, liquor and the like, for consumption at events hosted by the Keystone Weekend Inc., a 501(c)(3) entity with which Stapleton is associated, when the entity donating alcoholic products had ongoing contractual relationships with the PLCB and Stapleton was a Member and Chairman of the PLCB. 3. A transgression of Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), occurred in relation to Stapleton’s acceptance of hospitality (meals, golf outings, beverages) provided by various vendors who had ongoing contractual relationships with the PLCB, while Stapleton was a Member and Chairman of the PLCB. 4. A violation of Section 1105(b) of the Ethics Act, 65 Pa.C.S. § 1105(b), occurred in relation to Stapleton’s omission from his Statements of Financial Interests filed for the 2010 and 2011 calendar years of reportable information as to his receipt of gifts and hospitality from vendor(s) of the PLCB. In Re: Patrick Stapleton, : File Docket: 12-027 Respondent : Date Decided: 2/6/14 : Date Mailed: 2/12/14 ORDER NO. 1628 1. A transgression of Section 1103(a) of the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1103(a), occurred in relation to the acceptance by Patrick Stapleton (“Stapleton”) of donations of alcoholic beverages, such as wine, sprits, liquor and the like, for consumption at events hosted by the Keystone Weekend Inc., a 501(c)(3) entity with which Stapleton is associated, when the entity donating alcoholic products had ongoing contractual relationships with the Pennsylvania Liquor Control Board (“PLCB”) and Stapleton was a Member and Chairman of the PLCB. 2. A transgression of Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), occurred in relation to Stapleton’s acceptance of hospitality (meals, golf outings, beverages) provided by various vendors who had ongoing contractual relationships with the PLCB, while Stapleton was a Member and Chairman of the PLCB. 3. A violation of Section 1105(b) of the Ethics Act, 65 Pa.C.S. § 1105(b), occurred in relation to Stapleton’s omission from his Statements of Financial Interests filed for the 2010 and 2011 calendar years of reportable information as to his receipt of gifts and hospitality from vendor(s) of the PLCB. 4. Per the Consent Agreement of the parties, Stapleton is directed to make payment in the amount of $7,258.54 payable to the Commonwealth of Pennsylvania and forwarded to the Pennsylvania State Ethics Commission by no later than the th thirtieth (30) day after the mailing date of this Order. 5. Per the Consent Agreement of the parties, Stapleton is further directed to not accept any reimbursement, compensation or other payment from the PLCB representing a full or partial reimbursement of the amount paid in settlement of this matter. 6. To the extent he has not already done so, Stapleton is directed to file complete and accurate Statements of Financial Interests for calendar years 2010 and 2011 with the PLCB, through the Pennsylvania State Ethics Commission, by no later than the th thirtieth (30) day after the mailing date of this Order. 7. Compliance with Paragraphs 4, 5 and 6 of this Order will result in the closing of this case with no further action by this Commission. a. Non-compliance will result in the institution of an order enforcement action. BY THE COMMISSION, ___________________________ John J. Bolger, Chair